VictoryShares US Large Cap High Div Volatility Wtd ETF (CDL)

Overview

The VictoryShares US Large Cap High Dividend Volatility Weighted ETF (CDL) seeks to provide investment results that closely correspond to the performance of the Nasdaq Victory US Large Cap High Dividend 100 Volatility Weighted Index. It focuses on U.S. large-cap companies with high dividend yields while weighting them based on volatility, aiming for a balance of income and lower volatility.

Reputation and Reliability

Victory Capital Management is a well-established asset management firm with a diverse range of investment products and a reputation for delivering consistent investment strategies.

Management Expertise

The management team possesses extensive experience in quantitative investing and dividend-focused strategies, utilizing proprietary methodologies to construct and manage the portfolio.

Goal

The primary investment goal is to track the performance of the Nasdaq Victory US Large Cap High Dividend 100 Volatility Weighted Index, seeking a combination of high dividend income and reduced volatility.

Investment Approach and Strategy

Strategy: CDL aims to track a specific index that selects the top 100 dividend-paying large-cap companies based on trailing twelve-month yield and weights them inversely proportional to their volatility.

Composition The ETF holds a portfolio of U.S. large-cap stocks that exhibit high dividend yields and are weighted based on their historical volatility. The holdings primarily consist of common stock.

Market Share: The market share of CDL is moderate within the high-dividend ETF segment, often smaller than more established and larger funds.

Total Net Assets (AUM): 1212000000

Key Competitors

• Schwab US Dividend Equity ETF (SCHD)
• Vanguard High Dividend Yield ETF (VYM)
• iShares Select Dividend ETF (DVY)

Competitive Landscape

The high-dividend ETF market is competitive, with numerous funds vying for investor assets. CDL differentiates itself through its volatility-weighted approach, which aims to reduce risk. However, larger competitors benefit from greater brand recognition and lower expense ratios, posing a challenge to CDL's market share. CDL attempts to offer a balanced approach with dividend yield and risk management that differs from other ETFs emphasizing one over the other.

Historical Performance: Historical performance data needs to be checked from financial resources such as Yahoo Finance or Bloomberg Terminal

Benchmark Comparison: Needs to be checked from financial resources such as Yahoo Finance or Bloomberg Terminal to compare ETFu2019s performance to its benchmark index.

Expense Ratio: 0.35

Average Trading Volume

The average trading volume is moderate which indicates sufficient liquidity for most investors.

Bid-Ask Spread

The bid-ask spread typically reflects the ETF's trading volume and market demand which is tight for CDL.

Market Environment Factors

Economic indicators such as interest rates, inflation, and economic growth influence dividend-paying stocks and the overall market sentiment toward high-yield investments. Sector performance, especially in utilities, financials, and consumer staples, also affects CDL's performance. Current market volatility influences the effectiveness of its volatility-weighted strategy.

Growth Trajectory

The growth trajectory is tied to the increasing investor demand for dividend-focused strategies and low-volatility investments. Changes to strategy and holdings should be monitored through the ETF's regular disclosures and fund updates.

Competitive Edge

CDL's competitive edge lies in its unique volatility-weighted approach to high-dividend investing. This strategy aims to provide investors with a combination of high income and reduced risk, potentially outperforming traditional high-dividend ETFs during periods of market volatility. The methodology differentiates it from competitors who may focus solely on dividend yield or market-cap weighting. This dual objective might attract investors seeking a more balanced approach to dividend investing.

Volatility

Historical volatility depends on market dynamics of the time. It must be analyzed over different time periods.

Market Risk

Specific risks include sector concentration, dividend cuts from underlying holdings, and the potential underperformance of the volatility-weighted strategy during sustained bull markets.

Ideal Investor Profile

The ideal investor is a risk-averse individual seeking a combination of current income and capital appreciation, with a preference for lower volatility compared to the broader market.

Market Risk

CDL is suitable for long-term investors and passive index followers who prioritize dividend income and risk management.

The VictoryShares US Large Cap High Dividend Volatility Weighted ETF (CDL) offers investors exposure to U.S. large-cap dividend stocks with a focus on mitigating volatility. Its volatility-weighted approach differentiates it from traditional high-dividend ETFs, aiming to provide a more balanced risk-return profile. While its expense ratio is competitive, the ETF's performance is subject to market fluctuations and the effectiveness of its weighting strategy. Investors should consider their risk tolerance and investment goals before investing.

Data Sources:

• Victory Capital Management Website
• Yahoo Finance
• Bloomberg Terminal

Disclaimers:

This analysis is for informational purposes only and does not constitute investment advice. Investment decisions should be made based on individual circumstances and consultation with a qualified financial advisor. Market share percentages are estimated and may vary.