Getting quality dividend exposure is a must in today’s market where rising inflation and the pandemic are making the international market landscape a tricky place to navigate.
Fortunately, FlexShares offers three ETFs that focus on quality while also giving investors fixed income via international diversification. For starters, there’s the FlexShares International Quality Dividend Index Fund (IQDF ).
IQDF seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Northern Trust International Quality Dividend Index. The index reflects the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index, a float-adjusted market capitalization-weighted index of non-U.S.-domiciled large- and mid-capitalization companies.
The fund is one of the many dividend ETFs that FlexShares offers and one of the variants of the firm’s popular international dividend funds. IQDF gives investors access to quality dividends that focus primarily on stability.
A dividend ETF can be an ideal alternative for investors looking to extract that extra slice of yield, especially in the current market. With IQDF, investors also get income diversification with its inclusion of international holdings.
International dividend ETFs work much like their domestic high-dividend counterparts. The primary discerning feature is that they simply invest in international companies instead of those domiciled in the U.S.
A Defensive and Dynamic Option
Another fund to consider is the FlexShares International Quality Dividend Defensive Index Fund (IQDE ), which seeks investment results that correspond generally to the price and yield performance of the Northern Trust International Quality Dividend Defensive Index. The index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index.
“While international dividend investing is for some investors a well-established equity investment strategy, blindly pursuing international stocks with the highest dividend yields may be dangerous in the long run,” FlexShares says on the product website. “High dividend yields may mask underlying problems—such as weak stock prices due to poor financial performance—that could result in lower future dividend payments.”
Lastly, there’s the FlexShares International Quality Dividend Dynamic Index Fund (IQDY ), which seeks investment results that correspond generally to the price and yield performance of the Northern Trust International Quality Dividend Dynamic Index. The index is designed to reflect the performance of a selection of companies that, in aggregate, possess greater financial strength and stability characteristics relative to the Northern Trust International Large Cap Index.
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