Federal Reserve Chief Janet Yellen sounded awfully dovish in her views on further interest rate hikes last week and that's a good thing for dividend stocks, said Eric Ervin, CEO of Reality Shares.  

"You really want to focus on those growers, the companies that can actually grow the dividends which can keep pace with higher rates," said Ervin.

Ervin's Reality Shares DIVS ETF (DIVY)  is down around 1% thus far in 2016. The fund seeks to deliver long-term capital appreciation based on the growth of dividends, not stock price, of large cap companies. By isolating the growth of aggregate dividends, the ETF attempts to provide investors a number of potential benefits including portfolio diversification, as well as risk mitigation and lower volatility due to stock price gyrations.

"The only thing that the DIVY methodology cares about is if dividends are rising, not the stock market, so what you have seen this year is that dividend stocks have risen, but the dividends are fairly flat so far," said Erin.

The Reality Shares Divcon Leaders Dividend ETF (LEAD)  is up 5% so far in 2016. Unlike many dividend funds based on decades-old dividend history or yield, the fund invests in a select group of large-cap companies with the strongest potential to increase their dividends within a year.

"There are 34 companies that made this list, this top tier of companies that are going to increase their dividends," said Ervin. "And we do think that they will be increasing dividends in the next 12 months."

Finally, Ervin suggests investors seek out the Reality Shares Divcon Dividend Guard ETF (GARD) , which is down 9% since its mid-January launch. The fund dynamically adjusts its market exposure based on the strength of the market as determined by Reality Shares' Guard Indicator, a quantitative tool that gauges market strength by comparing technical trends in market price and volatility to historical averages.

"Unfortunately, the Guard Indicator is predicting a bearish market in the future now, but it's a slow moving indicator," said Ervin. "In the last 15 years it has only tripped three times."

More from Investing

What is a Stop-Limit Order and When Should You Use It?

What is a Stop-Limit Order and When Should You Use It?

The Fed Should Wait and See: Cramer's 'Mad Money' Recap (Thursday 12/13/18)

The Fed Should Wait and See: Cramer's 'Mad Money' Recap (Thursday 12/13/18)

Delta Air Lines Slips on Lower 2019 Profit Forecast

Delta Air Lines Slips on Lower 2019 Profit Forecast

Starbucks Shares Gain as Investor Day Highlights China Growth Ambitions

Starbucks Shares Gain as Investor Day Highlights China Growth Ambitions

Adobe Tops Q4 Sales Forecasts, Sees $11.1 Billion in 2019 Revenues

Adobe Tops Q4 Sales Forecasts, Sees $11.1 Billion in 2019 Revenues