Inflation rose by more than expected in September, ensuring the Federal Reserve continues its aggressive rate hikes as it aims to curb 40-year high inflation.
With continued rising interest rates and hints of recessionary conditions in the global economy, ALPS O’Shares U.S. Quality Dividend ETF (OUSA) is a strong offering to consider.
OUSA’s quality methodology that focuses on high return-on-assets and low leverage with low volatility and high dividend yields is pertinent for today’s risks in the market, according to ALPS.
“OUSA stands out from the crowd of dividend ETFs by incorporating other defensive-minded metrics that add to its appeal,” Todd Rosenbluth, head of research at VettaFi, said.
The fund overweights defensive sectors and avoids more cyclical sectors that tend to carry high debt loads.
OUSA’s excess yield generation positions it as a good candidate to pair with any core equity allocation to possibly lower volatility and increase portfolio yields. The fund charges a 48 basis point expense ratio and brings a factor-based, high dividend yield approach to the large-cap U.S. equities.
OUSA tracks the O’Shares U.S. Quality Dividend Index, whose constituents are selected from the S-Network US Equity Large-Cap 500 Index, which is a compilation of the 500 largest stocks of publicly listed companies within the U.S., according to VettaFi. All stocks included in the S-Network US Equity Large-Cap 500 Index are screened for free-float and average daily trading volume.
Other dividend ETFs available to investors include the SmartETFs Dividend Builder ETF (DIVS), the WisdomTree US High Dividend Fund (DHS), and the T. Rowe Price Equity Income ETF (TEQI).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
vettafi.com is owned by VettaFi, which also owns the S-Network US Equity Large-Cap 500 Index. VettaFi is not the sponsor of the S-Network US Equity Large-Cap 500 Index, but VettaFi’s affiliate receives an index licensing fee from the ETF sponsor.
