As investors weigh the impact of a shifting global economic backdrop and continued volatility in U.S. markets, attention is turning overseas. One fund that has emerged as a notable player in this space is the ALPS International Sector Dividend Dogs ETF (IDOG ).
Why IDOG Matters Now
IDOG tracks the S-Network International Sector Dividend Dogs Index (IDOGX), which selects the five highest-yielding stocks from each of 10 sectors in developed markets outside the U.S. including France, Japan, and the United Kingdom. The result is a diversified portfolio of 50 equal-weighted holdings, with a balance of yield and sector exposure that mirrors the domestic strategy used by its sibling fund, the ALPS Sector Dividend Dogs ETF (SDOG ).
IDOG’s approach provides targeted exposure to companies known for their shareholder payouts, including firms in traditionally high-yield sectors such as energy, financials, and utilities. The fund currently allocates a significant portion of its assets to these income-generating areas, offering a balance that can help smooth returns during market turbulence. Some of its top holdings include Japan Tobacco Inc, Singapore Telecommunications Ltd, Enel SpA and Imperial Brands.
Relative Strength in 2024
With a 15.24% year-to-date return (per YCharts), IDOG has outperformed many of its international peers and is drawing interest from those seeking diversified, high-yield equity exposure outside the U.S. In particular, broader international ETFs like the iShares MSCI EAFE ETF (EFA ) reported a 12.73% YTD return. IDOG stands out for its intentional focus on dividend income. While EFA delivers wide international exposure, it does not screen specifically for dividend yield, which can dilute income potential.
IDOG's History
IDOG’s performance last year reflects more than just market momentum. It also underscores the appeal of dividend-based strategies during periods of uncertainty. As the U.S. contends with elevated valuations and sector concentration, particularly in technology, international dividend payers have become somewhat of a safe haven for investors seeking both yield and geographic diversification.
While global macro risks remain, many developed markets have posted stronger-than-expected earnings growth while exhibiting relatively stable monetary policy environments. IDOG allows investors exposure to these trends through a disciplined, rules-based process.
VettaFi LLC (“VettaFi”) is the index provider for IDOG, for which it receives an index licensing fee. However, IDOG 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 IDOG.
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