Index Funds: ProShares Dividend Aristocrats ETF

After huge success with our first index fund, we’ve decided to add a new ETF to our Showroom.

Like dividends? Then you’re going to love this.

Back in March, we decided to give our users the opportunity to invest in an index fund. This was the first time that we had included anything other than individual stocks in our Showroom.

We did this by including our first ETF, or Exchange Traded Fund. An ETF is essentially a basket of stocks – a collection of different companies that have been compiled and managed by a financial institution.

We added the Vanguard S&P 500 ETF to our Showroom, which simply tracks the top five hundred companies in the US stock market. This way, our users could get exposure to 500 companies – including the likes of Apple, Amazon, and Alphabet – without having to buy 500 individual stocks.

And since we got such a good response to that decision, we’ve decided to add more index funds to our Showroom.

As always, we’ve been listening to what our users have been saying, and we know that one of the big requests we always get is more dividend stocks.


ProShares S&P 500 Dividend Aristocrats ETF

Today, we have added the ProShares Dividend Aristocrats ETF (NOBL) to our Showroom.

The Dividend Aristocrats ETF focuses on the 50 companies within the S&P that have the longest track record of year-over-year dividend growth. This means you’ll only be invested in companies that have increased their dividend payouts every year for at least 25 consecutive years.

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What’s The Benefit Of Investing In These Companies?

Well for starters, all these companies have been around for at least 25 years. So there’s a significant level of security in that.

Over the last 25 years, we’ve seen the dot-com bubble and the Financial Crisis – so not only have these companies survived tough times, they’ve kept pumping out more dividends to their shareholders throughout them.

Now you’d think these old dinosaurs would be well past their growth at this stage, but actually the Dividend Aristocrats ETF has greatly outperformed the market since inception in 2013. The fund has seen returns of 41% in that time, versus the S&P 500’s 27%.

What Companies Are Included In The Aristocrats ETF?

There’s a good mix of brands that you’ll have heard of like McDonald’s, PepsiCo, Johnson & Johnson and Target.

But you’ll also get exposure to some businesses you may never have heard of like McCormick (one of the largest manufacturers of spices), Medtronic (who make medical devices) and Ecolab (who specialize in water treatment technology).

A full list of the funds holdings can be found here.

Why Would You Invest In This ETF?

We still believe that everyone should invest in companies that they know and love. However, there are some major advantages to investing in an ETF.

Some reasons you might want to invest in the Aristocrats Dividend ETF are:

  • You have invested in a small number of stocks and wish to diversify your portfolio in a safe and efficient way.
  • You’re interested in investing but haven’t yet had the time to research individual companies.
  • You want some protection in the event of a market downturn – remember companies that have a long history of increasing their dividend tend to be less volatile and have a history of weathering down markets.
  • You would like to receive regular dividends from your investments.

Are There Any Fees Associated With This Fund?

Yes. ETFs and other financial vehicles that are managed by professionals have fees that are called the expense ratio. The expense ratio is deducted each fiscal year and goes towards paying the management and administrative fees incurred by the fund.

The expense ratio for this fund is 0.35% – which is in line with similar ETFs. That means if you invest $100, you will be charged 35 cents for every year that you hold the fund.

 

Interested in investing in ProShares S&P 500 Dividend Aristocrats ETF? 
Download our free Invest app now and find it in our Showroom!

 

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Start Investing

 

Rubicoin operates a full disclosure policy. Rubicoin staff currently hold long term positions in Vanguard S&P 500, Apple, Amazon and Google.

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