DIVZ - CDC: Revisiting This Once Top-Performing High-Dividend ETF
2024-03-14 09:57:21 ET
Summary
- CDC was once a top-performing high-dividend ETF, but in 2023, it ranked dead last in the large-cap value ETF category. Past performance was not a good indicator of future results.
- While its long/cash strategy succeeded in 2020, the underlying portfolio has gradually lost its low-beta advantage. It's now at the same level as SCHD's, which doesn't have a volatility screen.
- Due to the ETF's high 0.38% expense ratio, CDC and SCHD also offer nearly identical forward dividend yields, but SCHD is a much higher-quality fund.
- This article also examines SPHD and LVHD, two other funds combining the low-volatility and high-dividend factors. CDC is clearly inferior to at least one of these.
- Since I don't believe a turnaround is imminent, I have reiterated my "sell" rating on CDC.