Plenty of sectors, including consumer discretionary, energy, and real estate to name a few, are challenging dividend investors this year. However, dividend growth in the technology sector remains stout.
Advisors can deliver a solution levered to that theme with the Global Dividend Model Portfolio, which is part of WisdomTree’s Modern Alpha series of model portfolios.
“This model portfolio seeks to provide capital appreciation and high current dividend income, through a globally diversified set of WisdomTree’s dividend income oriented equity ETFs. The model strives to deliver dividend income in excess of the global benchmark of equities,” according to WisdomTree.
The Global Dividend Model Portfolio, which features nine ETFs, could be the ideal tonic for this year’s turbulent dividend environment.
Model Portfolios with Tech Dividends
“Nearly three times as many U.S. technology companies raised or initiated dividends in this year’s third quarter compared to those that cut or suspended dividends—an event financial advisors may want to consider when rebalancing their technology allocation, Todd Rosenbluth, CFRA’s head of ETF and mutual fund research, said today during a webinar he hosted on thematic investing and opportunities presented by re-opening the economy,” reports Tracey Longo for Financial Advisor.
One of the ETFs featured in this WisdomTree model portfolio is the First Trust NASDAQ Technology Dividend Index Fund (TDIV ).
TDIV tracks the NASDAQ Technology Dividend Index and allocates nearly 20% of its combined weight to tech behemoths Apple Inc. and Microsoft Corp. Those are two of the most well-known, steady dividend growers in the tech sector, but other TDIV components are helping the cause, too.
Plus, there’s room for tech dividend growth going forward.
“Information technology sported a below-average 1.1% dividend yield at the end of the third quarter, and 63% of the sector’s constituents paid a regular dividend,” notes Financial Advisor.
Another constituent in this model portfolio is a diversified U.S. dividend ETF, but one with above-average tech exposure relative to other dividend ETFs: the WisdomTree U.S. Quality Dividend Growth Fund (DGRW ).
DGRW seeks to track the price and yield performance of the WisdomTree U.S. Quality Dividend Growth Index. The index is a fundamentally weighted index that consists of dividend-paying U.S. common stocks with growth characteristics.