Legg Mason Low Volatility High Dividend ETF (LVHD)

Overview

The Legg Mason Low Volatility High Dividend ETF (LVHD) seeks to provide investment results that closely correspond, before fees and expenses, to the performance of the QS Low Volatility High Dividend Index. It focuses on high-dividend-yielding U.S. stocks with relatively low volatility.

Reputation and Reliability

Legg Mason is now part of Franklin Templeton, a well-established and reputable asset management firm with a long history.

Management Expertise

Franklin Templeton has a seasoned team of investment professionals managing various ETFs and mutual funds.

Goal

The ETF aims to provide current income and capital appreciation by investing in a diversified portfolio of high-dividend-yielding, low-volatility U.S. equities.

Investment Approach and Strategy

Strategy: LVHD tracks the QS Low Volatility High Dividend Index, which screens for high dividend yields and low volatility among U.S. stocks.

Composition The ETF primarily holds dividend-paying stocks selected based on volatility and dividend yield factors.

Market Share: LVHD's market share varies depending on the specific dividend ETF category, but it's a moderately sized player within that space.

Total Net Assets (AUM): 1157450000

Key Competitors

• Schwab US Dividend Equity ETF (SCHD)
• Vanguard High Dividend Yield ETF (VYM)
• iShares Select Dividend ETF (DVY)

Competitive Landscape

The dividend ETF space is crowded. LVHD's advantage lies in its low-volatility screen, potentially appealing to risk-averse investors. Disadvantages include potentially lower overall yield compared to funds that prioritize solely high dividend yields. SCHD & VYM are much larger and more liquid with lower expense ratios.

Historical Performance: Historical performance can be found on financial websites, varying depending on the time period measured.

Benchmark Comparison: LVHD's performance should be compared to the QS Low Volatility High Dividend Index to assess tracking effectiveness.

Expense Ratio: 0.27

Average Trading Volume

The average trading volume is moderate, which is usually sufficient for most retail investors but should be checked for current data.

Bid-Ask Spread

The bid-ask spread is generally tight, reflecting moderate liquidity, but real-time spreads should be examined before trading.

Market Environment Factors

Interest rates, economic growth, and dividend payout trends influence LVHD's performance. The low volatility factor benefits during uncertain periods.

Growth Trajectory

LVHD's growth depends on investor demand for low-volatility, high-dividend strategies. Changes in index methodology could affect holdings.

Competitive Edge

LVHD offers a blend of high dividend yield and low volatility, targeting investors seeking income with reduced risk. The index-based approach provides transparency and diversification. The ETF differentiates itself through a specific weighting scheme considering these two factors which can appeal to investors seeking a middle ground. While other ETFs offer dividends, this strategy allows investors a degree of protection against market swings and downturns, although not entirely.

Volatility

LVHD's historical volatility is expected to be lower than the broader market due to its screening process.

Market Risk

LVHD is susceptible to market risk as any investment in equity may decline due to overall market conditions and specific sector performance. Furthermore, dividend cuts by its underlying holdings can impact its dividend yield and overall return.

Ideal Investor Profile

LVHD is suitable for income-seeking investors who are also risk-averse and want exposure to equities but with less volatility than a broad market index.

Market Risk

LVHD is well-suited for long-term investors seeking income and capital appreciation, but active traders may find other ETFs with more volatility to be attractive.

Legg Mason Low Volatility High Dividend ETF (LVHD) provides investors with a diversified portfolio of high-dividend-yielding, low-volatility US equities. Tracking the QS Low Volatility High Dividend Index, it seeks to balance income generation with lower market risk, making it potentially appealing to risk-averse investors. It is a moderately sized player in the dividend ETF space with a solid backing by Franklin Templeton. However, investors should consider the expense ratio, trading volume, and potential sector concentration when evaluating if LVHD aligns with their investment goals.

Data Sources:

• Franklin Templeton Website
• ETF.com
• Morningstar
• Bloomberg

Disclaimers:

The data and analysis provided are for informational purposes only and should not be considered financial advice. Past performance is not indicative of future results. Consult with a qualified financial advisor before making any investment decisions.