DVY and HDV both boast heavy weightings towards non-cyclical sectors like utilities, consumer goods and health care. This makes them inherently well-suited to weather market turbulence. In addition, the substantial distributions paid out by these instruments will provide welcomed comfort during duress.
Throughout the past few months, we have seen how the strengths of these dividend-focused funds have shined through. Since the start of August, DVY has remained relatively unchanged, dipping less than 0.5%. HDV, on the other hand has jumped over 1.3%. Comparatively, the SPDR S&P 500 ETF (SPY) and SPDR Dow Jones Industrial Average Index Fund (DIA) have slid 6.5% and 4.0% respectively over this perioyd.
It is easy to get caught up in the ongoing sagas taking place across the global marketplace. While exciting to watch, investors must be careful to avoid letting the daily headlines muddle their decision-making abilities. Long-term focused products like DVY or HDV can help investors overcome today's challenges and prepare for the road ahead.
Written by Don Dion in Williamstown, Mass.