HDV: Evaluating the iShares Core High Dividend ETF

Mid Caps 3 replies 0 votes 2146 views

In the search for stability and superior performance, investors have been increasingly drawn to dividend-paying companies. The iShares Core High Dividend ETF (HDV) has emerged as a popular choice in this space, boasting an enticing 4.03% dividend yield and a low expense ratio of 0.08%. However, when evaluating HDV against its peers, a more nuanced picture emerges.

While HDV offers an attractive valuation and a higher dividend yield compared to many other high-dividend ETFs, its performance over the past decade raises some concerns. It has recorded a relatively modest 7.43% compound annual growth rate (CAGR) during this period, trailing behind its peers. Additionally, when examining risk-adjusted returns, such as the Sharpe and Sortino ratios, HDV falls short compared to its counterparts.

Considering these factors, it may be prudent for investors to exercise caution when considering HDV as an investment option. While it does provide exposure to large-cap, dividend-paying companies, its underperformance and weaker risk-adjusted returns suggest that there might be more suitable alternatives available in the high-yield ETF space. Therefore, investors may want to explore other options before making a decision.

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