FMD Capital Management

Posts Tagged: dividend etf

New ETF Takes A Smart Look At Small Cap Dividend Stocks

Written by David Fabian, March 21st, 2017

Small cap stocks are traditionally known as centers of growth in the global capital markets.  These companies often demonstrate greater risk due to their diminished market footprint.  However, they also offer compelling performance and diversification dynamics for investors with a higher risk tolerance.

Most exchange-traded funds that track this segment are focused on broad swaths of the small cap category.  They typically own hundreds, if not thousands, of individual stocks with market capitalization’s of less than $2-$3 billion.

Read the complete article at NASDAQ.com

Preferred Stock ETFs Face New Test

Written by David Fabian, March 13th, 2017

Preferred stocks offer the distinction of being unique hybrid instruments with qualities of both stocks and bonds.  In that manner, they offer healthy dividend yields alongside a favored position in the capital structure of many companies that issue these securities.

The reason company’s issue preferred shares are to raise capital from investors that are seeking an attractive yield without adding traditional debt (bonds) that carry strict maturity dates and covenants.  Preferred stocks can also be “callable” from the issuer, who has the right to redeem them at a certain price or time at their discretion.   Read more

ETF Investors Seek Shelter In Investment Grade Corporate Bonds

Written by David Fabian, March 07th, 2017

Rising interest rates are making many bond fund investors nervous about the prospects for weakening future returns and unstable risk dynamics.  This fear is putting some fuel behind ETF strategies that short Treasuries or sectors such as bank loans that have historically performed well in a rising rate environment.

The PowerShares Bank Loan Portfolio (BKLN), which invests in a basket of floating rate notes and senior loans, has accumulated more than $2.4 billion since the U.S. election.  That confidence has so far been rewarded with a steadily rising price trend versus the volatility that has pervaded most aggregate bond benchmarks.

Read the complete article at NASDAQ.com

The Value Play In Emerging Market Dividend ETFs

Written by David Fabian, January 17th, 2017

Investors who have held onto their U.S.-focused dividend ETFs have been rewarded in both income and capital appreciation during the breadth of this bull market.  The combination of relative momentum, low volatility, and steady accumulation of quarterly distributions have been the hallmarks of this steady trade.

Yet, those who study market history know that price performance that outstrips company fundamentals comes at a cost.  Namely higher statistical valuation measures, alongside slowly decreasing yield for new investors.  As a result, dividend stocks that looked attractive several years ago are now starting to rise into the expensive zone relative to other global opportunities.

Read the complete article at NASDAQ.com

Life Is Good For Mortgage REIT ETFs

Written by David Fabian, December 03rd, 2016

Real estate stocks have taken a beating in recent months as rising interest rates derail the momentum of this beloved income sector.  Yet despite the dip in traditional housing and commercial REITs, one high yield segment of the market is still seeing surging prices.

Mortgage REITs (or mREITs) have largely ignored the trend in Treasury bonds and instead focused on the continued strength in overall credit conditions.  This has translated into new all-time highs for the small group of exchange-traded funds that track these investments. Read more