Rising inflation and interest rates are hurting many fixed-income investments. As a result, many investors are turning toward dividend-paying stocks to generate a steady source of income. Global dividend stocks offer a combination of better yields and greater diversification, making them a compelling addition to any income portfolio.
Let’s look at how the newly launched Altrius Global Dividend ETF (NASDAQ: DIVD) aims to provide exposure to international dividend-paying stocks with a focus on sustainability.
See our Active ETFs Channel to learn more about this investment vehicle and its suitability for your portfolio.
Targeting Active Global Dividends
The Altrius Global Dividend ETF (DIVD) is an actively-managed ETF targeting global stocks paying sustainable dividends. With a modest 0.49% net expense ratio, the fund invests in a portfolio of 45 to 100 attractively-priced companies offering a combination of sustainable dividends and long-term growth potential.
The fund managers use a top-down analysis of global macro conditions to determine sector allocations. Next, they take a bottom-up approach to find undervalued companies offering steady and growing dividends. With its contrarian approach, the team takes advantage of crises and views each purchase as if they were buying a business, not a stock.
In practice, the fund invests about one-third of its assets in non-U.S. stocks, including up to 5% in emerging markets. With a minimum market cap of $1 billion, the fund’s holdings include a range of small- to large-cap companies, enabling the managers to cherry-pick the best opportunities.
The fund’s largest holdings currently include:
- BP Plc (BP) – 2.12%
- TotalEnergies SE (TTE) – 2.11%
- BAE Systems plc (BAESY) – 2.10%
- GSK plc (GSK) – 2.09%
- Posco Holdings Inc. (PKX) – 2.09%
Alternative ETFs to Consider
The Altrius Global Dividend ETF isn’t the only dividend-focused ETF with global exposure, although it’s the only actively-managed fund in the space. Three other global dividend ETFs offer passive exposure to the same types of companies, although they don’t take a value-driven approach to the market like Altrius Capital.
| Ticker | Name | Expense | Yield | AUM |
| VIGI | Vanguard International Dividend Appreciation ETF | 0.15% | 1.80% | $3.4 billion |
| DIVI | Franklin International Core Dividend ETF | 0.09% | 7.81% | $35.6 million |
Data as of October 13, 2022
Of course, investors have several other fixed-income alternatives as well. For example, covered call ETFs like the Global X NASDAQ 100 Covered Call ETF (QYLD) enable investors to generate income by writing call options against a portfolio of stocks. The WisdomTree Alternative Income Fund (HYIN) offers exposure to alternative credit products.
When choosing an ETF, investors should consider the expense ratio, liquidity, performance, yield, and risk factors. The Altrius Capital Dividend ETF has a more concentrated portfolio than the other options. However, its value focus may result in a greater margin of safety during a bear market and more upside potential when the market turns.
The Bottom Line
Rising inflation and interest rates are reigniting interest in dividend-paying stocks. Investors seeking diversified, sustainable global dividend income may consider the recently launched Altrius Global Dividend ETF. The fund’s active approach could offer more downside protection and better performance than its passively-managed counterparts.
Take a look at our recently launched Model Portfolios to see how you can rebalance your portfolio.
