iShares debuts two new dividend-focused equity ETFs

Feb 24th, 2012 | By | Category: Equities

iShares, the world’s largest manager of ETFs, has launched two new dividend-focused equity funds designed to provide access to fast-growing emerging markets and Asia/Pacific developed markets.

iShares debuts two new dividend-focused equity ETFs

The two new dividend-focused equity ETFs provide access to fast-growing emerging markets and Asia/Pacific developed markets, such as Australia.

Listed on the NYSE Arca, the funds are the iShares Emerging Market Dividend Index ETF (DVYE) and the iShares Asia/Pacific Dividend 30 Index ETF (DVYA). Both funds have an expense ratio of 0.49%.

The launch of these funds expands iShares’ existing suite of dividend ETFs and enhances the toolkit available to investors and advisers following income-oriented equity strategies.

iShares launched the first US-listed dividend ETF,  the iShares Dow Jones Select Dividend Index Fund (DVY), in 2003; the fund currently has over $10 billion in assets.

“In today’s market environment, traditional sources of income are offering historically low yields,” said Darek Wojnar, Head of iShares Product Development and Management at BlackRock. “Emerging markets and the developed markets in the Asia/Pacific region are expected to lead global economic growth and offer attractive opportunity for investment income in the near term. Income-seeking investors can use our dividend–paying funds to efficiently take advantage of potential economic growth in these regions, and possibly reduce portfolio volatility compared with growth-oriented stocks.”

“The new iShares funds are well positioned to marry international growth potential with the value characteristics of dividend solutions in an ETF,” Wojnar said. “The funds also offer investors the added benefit of a liquid investment approach, representing flexibility in establishing and adjusting allocations. A basket of high dividend-paying equities can often provide investors a cost-effective, transparent way to diversify their global equity income stream.”

The iShares Emerging Market Dividend Index Fund is benchmarked to the Dow Jones Emerging Market Select Dividend Index. The index offers exposure to 100 dividend-paying emerging market companies, weighted by indicated annual yield. The top sector holdings are Telecoms (17.3%), Industrials (15.9%), and Basic Materials (14.9%).

The iShares Asia/Pacific Dividend 30 Index Fund is benchmarked to the Dow Jones Asia/Pacific Select Dividend 30 Index. The index offers exposure to 30 dividend-paying companies in Australia, Hong Kong, Japan, New Zealand and Singapore, weighted by indicated annual yield. The top sector holdings are Financials (24.02%), Consumer Services (16.2%) and Telecoms (17.78%).

“The licensing of the Dow Jones Emerging Markets Select Dividend Index and the Dow Jones Asia/Pacific Select Dividend 30 Index by iShares underscores the continued demand for Dow Jones Indexes’ inventory of global dividend gauges,” said Michael A. Petronella, President, Dow Jones Indexes.

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