Pass on this ETF: Global X SuperDividend

Article Excerpt

GLOBAL X SUPERDIVIDEND ETF $21.23 (New York symbol SDIV) invests in 100 of the highest-yielding stocks worldwide. Stocks in the fund’s portfolio are equally weighted to reduce the risk associated with a high exposure to individual companies. The stocks must also meet certain market-cap and liquidity criteria. With 33.8% of the ETF’s assets, the U.S. is its largest country allocation. That’s followed by China (9.1%), Hong Kong (8.7%), Brazil 8.5%), Australia (8.1%), South Africa (4.1%), Indonesia (2.7%), Singapore (2.5%), Bermuda (2.3%), Taiwan (2.1%) and Italy (1.9%). The Global X SuperDividend ETF launched in June 2011 and charges an MER of 0.58%. Over the last 10 years, the fund has lost an average of 3.0% annually. That’s significantly worse than the 8.1% average annual gain for the benchmark MSCI All Country Index. The $735.4 million fund pays a fluctuating monthly dividend, which amounted to $2.56 a unit for the past 12 months. That gives it a high and attractive yield of 12.1%. However, we’ve said many times that…