In today’s market, building globally diversified portfolios requires more than just “set it and forget it“ investing with broad international indexes. The 2025 environment, shaped by volatility, shifting economic cycles, and divergent global policies, calls for a more deliberate and methodical approach, especially outside the U.S. According to Investopedia, traditional market-cap-weighted international indexes often concentrate risk in a few sectors, notably financials, which can be volatile. The ALPS Sector Dividend Dogs ETF (SDOG ) offers an alternative by selecting the five highest-yielding stocks in each of ten sectors from the 500 largest U.S. companies, weighting them equally.
This approach provides diversified exposure across sectors including industrials, financials, energy, and consumer discretionary. By focusing on cyclical value stocks with strong dividends, SDOG aims to combine income generation with capital appreciation potential, while providing built-in discipline through its rules-based methodology.
SDOG's Strategy
SDOG’s exposure to dividend-rich cyclical sectors such as energy, industrials, and financials has positioned it well amid uneven economic growth and inflationary pressures. Each sector makes up about 10% of the portfolio, creating broad market exposure. Its systematic rebalancing process helps investors maintain sector balance and capture value opportunities.
Over the past year, SDOG delivered a 1.19% return compared to -3.13% for the Schwab US Dividend Equity ETF (SCHD ), highlighting its resilience in recent market conditions.
For advisors and investors seeking a core U.S. equity allocation aligned with current market dynamics, SDOG offers diversification, income, and sector balance without sacrificing a focus on high-quality dividend payers.
VettaFi LLC (“VettaFi”) is the index provider for SDOG, for which it receives an index licensing fee. However, SDOG is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of SDOG.
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