Looking for a new take on dividend growth? The strategy behind the SmartETFs Asia Pacific Dividend Builder ETF (ADIV ) is up nearly 40% on the year, making the fund based on it an impressive, under-the-radar option for investors looking to gain income in their portfolio.
ADIV is an actively managed ETF that tracks dividend-producing equity securities that are tied economically to countries in the Asia-Pacific region.
Depending on market conditions, the fund usually holds anywhere from 25 to 75 assets (currently it has 37). Within the portfolio, stocks are roughly equally weighted.
Individual Security Performance Highlights In July
According to the most recent monthly report on ADIV, the ETF’s top-performing holding was Elite Material Co. which advanced 11.4% during the month of June. Elite Material has been the second-best-performing stock in the fund over both the quarter to date and the year to date.
“We hold Elite because of its skills in PCB laminates,” said the authors of the report. PCB laminates are a crucial building materials in IT infrastructure, such as next-gen data centers and switchboards. What’s more, “the stock’s dividend has grown by an average 18% a year over the past five years.”
In July, the managers also acquired a new position in Hong Kong-based China Overseas Land & Investment, another high-yielding stock with a track record of dividend growth. Over the past five years, China Overseas Land & Investment has grown its dividend by an average annual rate of 14%.
Despite the strength of the company’s real estate sales and its track record of solid cash generation, the position was undervalued and ADIV’s managers were able to purchase it at a bargain rate.
Other performance highlights include:
- Nien Made Enterprise, which saw a 57% rise in earnings per share.
- Catcher Technology, which saw a 4% profit bump year over year and increased its dividends 20%.
- The Public Bank of Malaysia, which rose 15% in Q1 2021, as compared to the previous year.
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