Published Thu, 10 Sep 2020 15:28:42 -0400 on Seeking Alpha
Seeking AlphaETF AnalysisiShares Emerging Markets Dividend ETF: 7.27% Yield Coupled With RisksSep. 10, 2020 3:28 PM ET|| About: iShares Emerging Markets Dividend ETF (DVYE)by: Vasily ZyryanovVasily Zyryanov Long/Short EquitySummaryDVYE provides exposure to a broad range of emerging markets, including China, Russia, and South Africa, to name a few.
Its dividend yield is around 7.27%, which looks exceptionally attractive amid a depressed yield environment.
DVYE underperformed SPY both year-to-date and in the last five years.
The ETF has a minuscule P/E of only 6.34x.
Multiple risks are associated with investing in emerging markets, from currency headwinds to geopolitics.
Diversification is at the crux of portfolio management. In order to minimize downside risks, maximize returns, and establish a dividend income stream, investors can look beyond borders and expand their geographical footprint. ETFs can be helpful in this sense, as they simplify the stock-picking process while also provide exposure to a broad range of equities. Moreover, ETFs mitigate single-stock volatility, as the outperformance of some constituents can offset the underperformance of others.
The phenomenally low yield environment makes income starved investors constantly struggle to find meaningful payouts that would be apt for their investing strategies. The remarks Fed Chair Jerome Powell made on inflation point to one evident fact: U.S. interest rates are not about to creep higher, as temporary fluctuations in inflation will be tolerated.
So, today I would like to take a deeper look at a ~7.27% yielding iShares Emerging Markets Dividend ETF (DVYE) managed by BlackRock Fund Advisors, which income-oriented investors might consider for the long term. Certainly, after careful examination of all related risk factors.
The top line Performance
The investment strategy of the fund is to track the Dow Jones Emerging Markets Select Dividend Index. In 2019-2020, DVYE distributed income on... Read more