Top Performing Dividend ETFs For June 2021

Although the market mostly belonged to growth in June, some dividend ETFs still managed to post decent returns.
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If you were looking for big equity market returns in the month of June, you probably didn't find them among dividend ETFs. The list of top performing June ETFs overall featured more than two dozen funds posting 10%+ returns, but they were almost exclusively from the areas of next-gen tech, clean energy, innovation and biotech. The top performing dividend ETF came nowhere near cracking that list.

Investors focused on the global economic recovery in June and targeted ETF plays that would take advantage of it. Defensive sectors, perhaps with the exception of real estate, lagged pretty significantly as the growth sectors - tech, consumer discretionary and communication services - mostly led the market higher.

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Dividend ETFs tend to be overweighted in cyclicals, so we really need to see leadership from areas, such as financials, energy and industrials, to see these ETFs push back to the top of the best performer list. We may see it again later this year, but we definitely didn't see it in June.

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

Top Performing Dividend ETFs for June 2021

Top Performing Dividend ETFs for June 2021

There were only two dividend ETFs that returned more than just 3% in June - the WisdomTree Emerging Markets SmallCap Dividend ETF (DGS) and the WisdomTree International Hedged Quality Dividend Growth ETF (IHDG). DGS's place at the top of the list is a bit curious considering both emerging markets and small-caps underperformed in June. In the case of IHDG, the hedged position against the dollar helped immensely when the greenback spiked following the quarterly Fed meeting.

Quality is a persistent theme throughout this list. A trio of FlexShares ETFs - the FlexShares Quality Dividend Defensive Index ETF (QDEF), the FlexShares Quality Dividend Dynamic Index ETF (QDYN) and the FlexShares Quality Dividend Index ETF (QDF) - all made the list demonstrating the potential of the FlexShares' dividend scoring system, which focuses on profitability, management efficiency and high yield.

Dividend growth ETFs didn't make much a dent in the 1st half list of top performing ETFs, but they definitely showed up here in June. The ProShares S&P Technology Dividend Aristocrats ETF (TDV) offers a nice balance between growth and income that took advantage of the tech rally during the month. Another of the issuer's funds, the ProShares MSCI Europe Dividend Growers ETF (EUDV), did well despite weakness in international equities. WisdomTree's quality dividend growth focus shows up in the WisdomTree Global ex-US Quality Dividend Growth ETF (DNL), the WisdomTree Europe Quality Dividend Growth ETF (EUDG), the WisdomTree International Quality Dividend Growth ETF (IQDG) and the WisdomTree U.S. Quality Dividend Growth ETF (DGRW), one of the best dividend ETFs around.

The Fidelity Dividend ETF For Rising Rates ETF (FDRR) is an interesting inclusion. Interest rates have been up and down throughout 2021 and FDRR invests in stocks who historically have had a high correlation to Treasury yields.

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