- The Morningstar Dividend Leaders Index has a habit of buying when it should be selling, and selling when it should be buying.
- In June 2020, it dropped all its Energy holdings at fire sale prices, only to buy them back again this June after the sector had recovered.
- The Index has solid screens, but FDL is potentially flawed by its high turnover, not allowing its deep-value plays to realize their potential.
- FDL and its 4.47% forward yield could work for certain investors if they're willing to accept low revenue and earnings growth rates and below-average cash to debt positions.
For further details see:
Investing Without Conviction: Why FDL Can Be Frustrating