Amplify ETFs has launched an index-based ETF investing in dividend-paying U.S. exchange-listed equities operating primarily in natural resource and commodity-related industries.
The Amplify Natural Resources Dividend Income ETF (NDIV ), listed on the NYSE on August 24, seeks investment results that generally correspond to the price and yield of the EQM Natural Resources Dividend Income Index.
NDIV will invest in U.S.-traded American depositary receipts (ADRs) or over-the-counter (OTC) listed shares of global natural resource, commodity-related companies, which include energy, chemicals, agriculture, metals and mining, paper products, and timber, according to a statement from the firm.
“We believe that select dividend-paying energy and materials stocks are positioned attractively due to strong cash flows, growing distributions, and current price-to-earnings (P/E) ratios,” Christian Magoon, CEO of Amplify ETFs, said in a statement. “For example, the EQM Natural Resources Dividend Income Index has a P/E ratio of 5.51 compared to the S&P 500 Index of 19.00. Additionally, the energy sector is currently generating higher or more attractive dividends than the S&P 500. We believe these positive attributes provide an opportunity for high monthly income potential.”
NDIV offers a way for investors to capture the opportunities in both “old” and “new” energy companies, as well as the related materials sector. The energy sector’s dividends have grown faster than any other part of the U.S. equity market. Since 2016, energy companies’ dividend amounts were up 80% over the last five-year period. Since 2018, the average dollar amount of dividends among energy companies has grown over 50%, which is up from the prior three years’ growth of only 5%, according to Amplify.
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