Skip to main content

Dividend stocks had another month of pretty middling performance in July as investors more or less stuck with large-cap growth again at the expense of cyclicals, small-caps and dividend payers. If you use the WisdomTree U.S. Total Dividend ETF (DTD), an all-cap dividend equity portfolio, as the benchmark, dividend stocks underperformed the S&P 500 (SPY) by about 0.6%. Dividend growth stocks again did comparatively well topping the index by about 0.7%, while dividend quality and high yield strategies lagged.

The broader theme of dividend stock underperformance has been in place since March. That's when questions began to arise about the economic recovery and investors pivoted away from cyclicals. Since financials, industrials and energy tend to be overweight in dividend ETFs thanks to their comparatively higher yields, cyclical drag tends to correlate with dividend stock underperformance. That's exactly what we're seeing here.

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

Still, there were some, but not many, dividend ETFs that managed to outperform the S&P 500 last month. The dividend growth theme, not surprisingly, places the most entries on the top 30 list, but there's enough variety in there - Europe, small-caps, REITs and low volatility - to help generate a little conversation.

Here's the list of the top performing dividend ETFs for the month of July 2021.

Top Performing Dividend ETFs for July 2021

Top Performing Dividend ETFs for July 2021

The top performing dividend ETF in July didn't come from the United States. It targets dividend growth stocks in Europe. The ProShares MSCI Europe Dividend Growers ETF (EUDV) is an equally-weighted portfolio of stocks that have a minimum of 10 consecutive years of dividend growth. Its sizable overweight in healthcare stocks helped its cause.

Several of the dividend ETF heavyweights also landed on the list. The Vanguard Dividend Appreciation ETF (VIG), the WisdomTree U.S. Quality Dividend Growth ETF (DGRW), the iShares Core Dividend Growth ETF (DGRO) and the ProShares S&P 500 Dividend Aristocrats ETF (NOBL) all produced returns of 2% or more in July. Not surprisingly, all four of these funds have a dividend growth component to their strategies.

Other dividend growth ETFs making the cut include the ProShares MSCI EAFE Dividend Growers ETF (EFAD), which operates similarly to EUDV, the ProShares S&P Technology Dividend Aristocrats ETF (TDV), which benefited from the positive sentiment within growth and tech stocks, the VictoryShares Dividend Accelerator ETF (VSDA), a smaller under-the-radar fund offering, and the Invesco Dividend Achievers ETF (PFM).

Real estate was one of the market's top performing sectors in July and we see multiple REIT-themed ETFs posting positive returns. The Invesco KBW Premium Yield Equity REIT ETF (KBWY) is a volatile real estate ETF that yield-weights the portfolio giving higher allocations to inherently riskier securities. The ALPS REIT Dividend Dogs ETF (RDOG) similarly targets high yielders within the sector.

Other ETFs worth noting:

Kevin O'Leary's O'Shares firm continues landing ETFs in the top performer list. The O'Shares Europe Quality Dividend ETF (OEUR) landed in the market's sweet spot last month, while the O'Shares U.S. Small-Cap Quality Dividend ETF (OUSM) managed to beat the dueling headwinds of underperforming small company stocks and underperforming quality dividend names to produce a market-matching return.

T. Rowe Price is known more for its mutual fund lineup, but it's finally starting to get into the ETF market. The T. Rowe Price Dividend Growth ETF (TDVG) is modest in size, but had another good month.

The Timothy Plan High Dividend Stock ETF (TPHD) targets 100 high yielding large-cap dividend stocks and volatility-weights the portfolio by giving larger allocations to lower volatility stocks. It also screens for companies that meet the company's biblically responsible investing filtering criteria.

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

Also read:

Top Performing ETFs For July 2021

Tuttle Files For A Short ARKK ETF

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

The ARK ETFs Loaded Up On Robinhood; That's A Mistake

ETF Battles: YOLO vs. MJ vs. MSOS - Which Cannabis ETF Is Best?

China ETFs Getting Pounded Amid Government Crackdowns

QQQJ vs. QQQN: A Comparison Of Two Nasdaq Next Gen ETFs

The Two Types Of ETFs You Should Be Avoiding Right Now