Under the Hood: A Look At An Interesting Dividend ETF

In the search for dividends and solid yields, ETFs have become a favoured tool among investors, but even with the evolution of dividend ETFs, there are still plenty of high-yielders that continue to fly under the radar.

One such example is the Claymore/Zacks Multi-Asset Income ETF (CVY). CVY is similar to bigger, better known dividend ETFs in that the ETF doesn’t focus on a particular sector, opting to go where the money is and find strong dividends regardless of industry group.

Still, CVY has a compelling lineup that investors of all risk tolerance levels can be comfortable with. CVY focuses on high-yielding asset classes such as master limited partnerships (MLPs), real estate investment trusts (REITs), international dividend payers as well as some basic U.S. blue chips.

As of the end of June, CVY held 147 stocks with an average market cap over $10 billion, so this fund is large-cap focused. The top holdings include familiar names such as Chevron, ConocoPhillips, DuPont, and Philip Morris as well as MLPs like Linn Energy and international dividend darlings like Telefonica and AstraZeneca.

One drawback may be an almost 24% weight to financials, but some of that exposure comes via preferred stocks. Energy gets an almost 21% weight while utilities account for almost 18% of CVY.


— The ETF Professor

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