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SDY: Dividend Income With A Solid Long-Term Track Record

Apr. 01, 2022 10:23 AM ETSPDR® S&P Dividend ETF (SDY)4 Comments
Michael Fitzsimmons profile picture
Michael Fitzsimmons


  • The SPDR S&P Dividend ETF is oriented for income but also has a solid 10-year average annual return of 12.5%.
  • The top-2 holdings are Exxon Mobil & Chevron. These two companies not only have strong yields but are poised to deliver strong FCF given the current macro environment.
  • However, with a 16.3% allocation, Financials are the fund's largest sector position. A rising interest rate environment is generally bullish for these stocks as well.
  • Other sectors with relative high exposure include industrials, consumer staples, and utilities.

Upward arrow made of dollar banknotes on white background - Concept of growing and upward trend of dollar currency

CalypsoArt/iStock via Getty Images

My followers know I am a big fan of holding a well-diversified portfolio built for the long-term. Part of any well-diversified portfolio should be dividend paying stocks and of course there are various strategies in this regard. These

This article was written by

Michael Fitzsimmons profile picture
Technology stocks, ETFs, portfolio strategy, renewable energy, and O&G companies. Primary goal is growing net-worth. I typically allocate a portion of my own portfolio and devote some of my SA articles to small and medium sized companies offering compelling risk/reward propositions. I am an Electronics Engineer, not a qualified investment advisor. While the information and data presented in my articles are obtained from company documents and/or sources believed to be reliable, they have not been independently verified. Therefore, I cannot guarantee its accuracy. I advise investors conduct their own research and due-diligence and to consult a qualified investment advisor. I explicitly disclaim any liability that may arise from investment decisions you make based on my articles. Thanks for reading and I wish you much investment success!

Analyst’s Disclosure: I/we have a beneficial long position in the shares of COP, CVX, XOM, SCHD, AMZN, GOOG, ENB either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I am an electronics engineer, not a CFA. The information and data presented in this article were obtained from company documents and/or sources believed to be reliable, but have not been independently verified. Therefore, the author cannot guarantee their accuracy. Please do your own research and contact a qualified investment advisor. I am not responsible for the investment decisions you make.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (4)

Michael Fitzsimmons profile picture
@SleepyInSeattle - great minds think alike ;) Have a nice weekend!
SA-NJ52 profile picture
I have far better ETFs in my portfolio than SDY or SCHD.

Michael Fitzsimmons profile picture
@gandc - if you read the article, you'd know I did not recommend SDY. But I did recommend (and own) SCHD, and investors could certainly do worse than SCHD's 10-year average annual return of 15.34%. I am quite happy with that and don't own any other dividend income ETF (but, as I mentioned in the article, I do own several other excellent dividend income paying stocks, including XOM, CVX, COP, ENB, and Broadcom).

I have ETFs that have performed better too ... but they are not in the dividend income category - which was what this article was about. I prefer to own and hold a well-diversified portfolio ... and don't put all my eggs into one ETF, let alone the one that has most recently performed the best.
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