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Small Stocks with Big Payouts: The SDVY ETF February 25, 2021
Income investors usually focus on large cap equities in the hunt for reliable dividends, but smaller stocks offer plenty of payout potential. The
The First Trust SMID Cap Rising Dividend Achievers ETF follows the NASDAQ US Small Mid Cap Rising Dividend Achievers Index. That benchmark “is composed of the securities of 100 small- and mid-cap companies with a history of raising their dividends and exhibit the characteristics to continue to do so in the future,” according to First Trust.
SDVY’s high-quality focus may also help dividend growers outperform the broader markets during weaker periods. Dividends have been a powerful source of long-term returns. They have added significantly to returns over time, contributing approximately 32% of the S&P 500’s total return since 1960.