The market has changed recently and tech stocks,
retail plays, and stay-at-home stocks are no longer ruling the
roost, at least for now.
So, what’s working now?
Here are four exchange-traded-funds (ETFs) that not
only are currently outperforming the market, all have strong
long-term (three year) return records. Why? Probably because they’re
not industry specific. Thus, they can easily adjust their portfolios
to market shifts. So they may be more long-term resilient plays than
the ETFs I gave you last October.
Better yet, all four are paying meaningful dividends.
Even if the market dips, you’ll still be getting paid to own them.
Here’s the list.
• VictoryShares US Small
Cap (CSB) tracks high-dividend-paying NASDAQ-listed stocks with
market capitalizations below $3 billion. Further, to make the list,
all must have recorded positive earnings for at least the last four
quarters. But that’s just for starters. A lot of research has found
that that low volatility stocks (low beta) usually outperforms
higher beta stocks. So, when configuring the portfolio,
VictoryShares overweights the lowest beta stocks. Biggest holdings
include B. Riley Financial (RILY), Waddell & Reed Financial (WDR),
and Systemax (SYX). The fund has returned 23% over the past three
months, 107% over 12-months, and averaged 16% annually over three
years. It’s paying monthly dividends equating to a 3.6% dividend
• Invesco High Yield
Equity Dividend Achievers (PEY) tracks an index of 50
high-dividend stocks primarily selected based on dividend growth
history. Biggest holdings include Exxon Mobil (XOM), ONEOK (OKE),
and Altria Group (MO). The fund has returned 17% over three months,
54% over the past 12-months, and averaged 10% annually over three
years. It’s paying monthly dividends equating to a 4.0% yield.
• SPDR Russell 1000Yield
Focus (ONEY) Holds 280 members of the Russell 1000 index. While
the stocks are initially selected primarily based on dividend yield,
the individual stock weightings are based on profitability and risk
measures, Top holdings include Ford Motor (F), HP, Inc. (HPQ), and
Marathon Petroleum (MPC). The fund has returned 23% over three
months, 98% over the past 12 months, and averaged 14% annually over
three years. It pays quarterly dividends equating to 2.4% yield.
• Schwab US Dividend
Equity (SCHD) tracks an index of high-dividend stocks that have
paid dividends for a minimum of 10 consecutive years. Further to
qualify for the portfolio, these stocks must meet additional
earnings, cash flow, and dividend growth requirements. Top holdings
include Texas Instruments (TXN), 3M Company (MMM), and International
Business Machines (IBM). The fund returned 13% over three months,
63% over 12-months, and averaged 16% annually over three years. It’s
paying quarterly dividends equating to a 3.0% yield.
Those are my ideas. But, if I were always right, I
wouldn't have to be spending my days pounding away on this keyboard.
So, due your own due diligence. The more you know about your stocks
and funds, the better your results.