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Buyback ETFs among year's best performers

  • Dividend ETFs may be more popular, but funds focused on companies returning capital to shareholders via buybacks are among the top performers of 2013. Among the group is the PowerShares Buyback Achievers ETF (PKW), and AdvisorShares TrimTabs Float Shrink ETF (TTFS).
  • PKW - with expenses of 0.71% after a fee waiver - only buys companies who have repurchased at least 5% or more of its outstanding shares in the past year. TTFS - with expense ratio of 0.99% - too focuses on smaller floats and adds profitability and balance sheet strength to its algorithm. The two have outperformed the DVY by more than 1000 bps YTD.
  • Dividend ETFs: FDL, FVD, MDIV, QDF, QDYN, QDEF, DIV, CVY, DVY, HDV, IYLD, PEY, PFM, SCHD, SDY, SDYL, DVYL, VYM, DHS, DTD, SYLD, KBWD, SPHD, DLN, DON, HILO.
Comments (4)
  • Left Banker
    , contributor
    Comments (1995) | Send Message
     
    I'll add that not only has PKW been beating the dividend ETFs this year, it's been doing it consistently since its inception.

     

    Numbers on these PKW and TTFS are pretty similar except that TTFS's daily volume is something like 12K shares and it's a bit pricier. Tie goes to PKW for my portfolio.

     

    TTFS does have a much greater bias to mid- and small-caps.
    19 Aug 2013, 01:23 PM Reply Like
  • Swisser998
    , contributor
    Comments (133) | Send Message
     
    But... the DGI crowd says that buybacks don't work and that only dividends matter. I get so confused...
    19 Aug 2013, 02:20 PM Reply Like
  • jack7340
    , contributor
    Comment (1) | Send Message
     
    Plot PKW since it started in 2007 against say SDY (including dividends) and see how they line up. That should tell you all you need to know. PKW !!!
    19 Aug 2013, 03:17 PM Reply Like
  • Christopher Mahoney
    , contributor
    Comments (909) | Send Message
     
    What I like about PKW is that: (1) it's model is obscure, so laymen don't get it: (2) it's about management behavior, not about growth or value; (3) it is 100% automatic; it doesn't care what the "story" is, it just wants its money back; and (4) the kind of management that can generate strong FCF and is willing to give it back is probably a lot smarter than the management that plows its cash back into stupid investments, like most growth companies.
    26 Aug 2013, 10:26 PM Reply Like
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