Top Performing Dividend ETFs For The 1st Half Of 2021

Several of the biggest, most well-known dividend ETFs around, including SCHD, SPHD and DVY, made the cut.
Author:
Publish date:

Stocks had a strong 1st half of the year with the S&P 500 returning more than 15%, but the landscape was a little more challenging for dividend stocks and ETFs. Dividend ETFs, which tend to be overweight in cyclical sectors such as financials and energy, outperformed when these groups led the market higher, but tended to lag when growth took over.

Dividend growth ETFs, as a whole, underperformed the broader market. The ProShares S&P 500 Dividend Aristocrats ETF (NOBL) managed a 14% return, but the Vanguard Dividend Appreciation ETF (VIG) gained just 10%. Significant underperformance from the utilities and consumer staples sectors, two areas of the market that often get targeted in dividend ETFs, didn't help the cause.

Note: Interested in getting periodic e-mail notifications when articles are published here? Drop your e-mail in the box below!

The first half belonged to high yield funds as risk-taking was largely rewarded. Most funds appearing on the top 30 performer list have high yield as an objective, but some have dividend growth or quality strategies built in as well. There's some presence of international and global ETFs on the list, but the 1st half mostly belonged to those funds focused on U.S. stocks.

Here's the list of the top performing dividend ETFs for the 1st half of June 2021.

Top Dividend ETFs For The 1st Half Of 2021

Top Dividend ETFs For The 1st Half Of 2021

There's actually a pretty diverse mix of targeting strategies around the high yield theme. We see some sector-focused funds, some targeting mid- or small-caps and some using value, low volatility or momentum tilts.

The 1st half's top performer is the Invesco KBW High Dividend Yield Financial ETF (KBWD), a fund that invests mostly in high-yielding banks, mortgage REITs and other financial companies and dividend-weights the portfolio. It rode the cyclical recovery trade and (up until recently) trend of higher interest rates to a nearly 30% return in the 1st half.

A modestly surprising result might be the presence of so many of the marketplace's largest ETFs appearing on this list. Typically, it's the smaller niche-oriented funds that target the right spot and the right time to produce big short-term returns, but several of the big boys managed to do the same. Not surprisingly, they generally had a high yield focus.

The Schwab U.S. Dividend ETF (SCHD), the SPDR Portfolio S&P 500 High Dividend ETF (SPYD), the iShares Select Dividend ETF (DVY), the ALPS Sector Dividend Dogs ETF (SDOG) and the Invesco S&P 500 High Dividend Low Volatility ETF (SPHD) all delivered returns of at least 19% during the past 6 months.

Dividend growth wasn't omitted altogether. The First Trust SMID Cap Rising Dividend Achievers ETF (SDVY), the First Trust Rising Dividend Achievers ETF (RDVY) and the Invesco High Yield Equity Dividend Achievers ETF (PEY) made the cut with 20%+ returns, although those gains are more attributable to their high yield focus as opposed to their dividend growth requirements. Still, it's encouraging to see some "yield plus growth" options for investors here.

The First Trust Dorsey Wright Momentum & Dividend ETF (DDIV), the AAM S&P 500 High Dividend Value ETF (SPDV), the WBI Power Factor High Dividend ETF (WBIY) and the Global X S&P 500 Quality Dividend ETF (QDIV) were among the thematic-focused ETFs that generated big returns.

Note: Interested in getting periodic e-mail notifications when articles are published here? Drop your e-mail in the box below!

Also read:

2 ETFs To Consider Buying (And 1 To Avoid) This Week

Top Performing Leveraged ETFs For June 2021

A Big First Half For Cannabis ETFs

Top 30 Performing ETFs For The 1st Half Of 2021

Top Performing ETFs For June 2021

Vanguard Dividend Appreciation ETF (VIG) About To Get A New Look

10 Under The Radar Dividend ETFs Worth Considering

Buy This ETF To Hedge Against Rising Housing Inflation