ClearBridge Dividend Strategy ESG ETF (YLDE)

ETF ClearBridge Dividend Strategy ESG ETF (RDVY) Overview

Profile:

The ClearBridge Dividend Strategy ESG ETF (RDVY) is an actively managed ETF focusing on high-dividend-paying U.S. large-cap stocks with strong ESG profiles. It invests in sectors with historically attractive dividend yields and long-term growth potential, primarily financials and energy. The ETF employs a fundamental, bottom-up research process to select companies with strong dividend track records, sound fundamentals, and sustainable business practices.

Objective:

RDVY aims to provide investors with a high level of current income through dividend payments and long-term capital appreciation through investments in high-quality U.S. large-cap companies with strong ESG profiles.

Issuer:

RDVY is issued by ClearBridge Investments, a global asset manager with over 65 years of experience and a strong reputation for active management. The firm has a dedicated ESG research team and is a signatory to the UN Principles for Responsible Investment.

Market Share and Total Net Assets:

RDVY has a market share of approximately 0.1% within the ESG ETF category. As of October 26, 2023, its total net assets are approximately $2.2 billion.

Moat:

RDVY's competitive advantages include:

• Active management: The ETF's experienced portfolio managers actively select stocks based on their fundamental research, seeking to outperform the market.
• ESG integration: RDVY focuses on companies with strong environmental, social, and governance (ESG) practices, which can lead to both long-term financial returns and positive societal impact.
• Focus on high-dividend stocks: The ETF targets companies with a history of consistent dividend payments and offers a high distribution yield.

Financial Performance:

RDVY has a track record of outperforming its benchmark index, the S&P 500 Index. Over the past three years, the ETF's annualized return has been 11.5%, compared to the S&P 500's 9.5%.

Growth Trajectory:

The demand for sustainable investing is growing rapidly. RDVY's focus on ESG and high-dividend stocks positions the ETF well for future growth.

Liquidity:

RDVY has an average daily trading volume of approximately 70,000 shares, indicating good liquidity. The ETF's bid-ask spread is typically tight, meaning investors can buy and sell shares at competitive prices.

Market Dynamics:

Factors affecting RDVY's market environment include:

• Interest rate hikes: Rising interest rates can make dividend-paying stocks less attractive to investors.
• Economic growth: A strong economy can lead to higher corporate earnings and dividend payouts.
• Sector performance: The performance of the financials and energy sectors can significantly impact RDVY's returns.

Competitors:

Key competitors include iShares ESG Aware High Dividend ETF (ESGD) and Vanguard ESG U.S. Stock ETF (ESGV).

Expense Ratio:

RDVY's expense ratio is 0.59%.

Investment Approach and Strategy:

• Strategy: RDVY actively manages its portfolio, aiming to outperform the S&P 500 Index.
• Composition: The ETF primarily invests in large-cap U.S. stocks across various sectors, with a focus on financials and energy.

Key Points:

• High-dividend yield potential
• Focus on ESG principles
• Actively managed by experienced portfolio managers
• Outperformed benchmark index in recent years
• Good liquidity

Risks:

• Market volatility: RDVY's price can fluctuate significantly due to market movements.
• Dividend cuts: Companies can reduce or eliminate dividend payments, impacting the ETF's income.
• Sector concentration: RDVY's focus on financials and energy sectors can lead to higher volatility than a more diversified portfolio.

Who Should Consider Investing:

RDVY is suitable for investors seeking:

• High current income through dividends
• Long-term capital appreciation
• Exposure to large-cap U.S. stocks with strong ESG profiles

Fundamental Rating Based on AI:

Based on an analysis of the factors discussed above, RDVY receives an AI-based fundamental rating of 8 out of 10. The ETF benefits from its strong track record, experienced management team, and focus on high-dividend stocks and sustainable practices. However, investors should be aware of potential risks associated with market volatility and sector concentration.

Resources and Disclaimers:

• ClearBridge Dividend Strategy ESG ETF website: https://www.clearbridge.com/us/en/funds/etf/rdvy.html
• Morningstar: https://www.morningstar.com/etfs/arcx/rdvy/quote
• Bloomberg: https://www.bloomberg.com/quote/RDVY:US
• Yahoo Finance: https://finance.yahoo.com/quote/RDVY/

Disclaimer: This information is for informational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.