The Dow Jones Stoxx Select Dividend 30 Index has been licensed to First Trust Portfolios to serve as the underlying basis for an exchange-traded fund launched on the American Stock Exchang
The Dow Jones Stoxx Select Dividend 30 Index has been licensed to First Trust Portfolios to serve as the underlying basis for an exchange-traded fund launched on the American Stock Exchange, the first time the index has been licensed as the basis for an ETF in the US.
‘The Dow Jones Stoxx Indexes are the most successful and widely used pan-European indices, ranking first in Europe underlying ETFs as well as futures and options, and second in derivatives products worldwide,’ says Werner Buerki, chairman of the Stoxx supervisory board.
‘Since its launch the popularity of the Dow Jones Stoxx Select Dividend 30 Index has grown substantially due to its index methodology that weights index components by dividend yield instead of market capitalisation. Licensing the index as the basis of an ETF allows market participants to add high-dividend-paying European companies to their portfolios.’
Launched in April 2005, the index measures the performance of the 30 highest dividend-paying stocks from 18 countries relative to their home markets in Europe. To be included in the Select Dividend 30 Index, stocks must have a positive, five-year dividend-per-share growth rate, and a dividend-to-earnings-per-share ratio that is less than or equal to 60 per cent.
Index components are weighted by their indicated annual net dividend yield, with the highest dividend-yielding companies having the greatest weight in the index. Individual components weightings are capped at 15 per cent. The index uses the Dow Jones Stoxx 600 Index, plus its secondary lines, as the underlying index universe, and is reviewed annually in March.
The fund invests at least 90 per cent of its total assets in common stocks that comprise the index or in American depositary receipts, global depositary receipts or European depositary receipts representing securities in the index.
The Select Dividend 30 Index complements the Dow Jones and Dow Jones Stoxx Select Dividend Index series, which consists of the Dow Jones U.S. Select Dividend Index, Dow Jones EPAC Select Dividend Index, the Dow Jones Stoxx Global Select Dividend 100 Index, the Dow Jones Euro Stoxx Select Dividend 30 Index, the Dow Jones Stoxx Nordic Select Dividend 20 Index, the Dow Jones Stoxx EU Enlarged Select Dividend 15 Index, the Dow Jones Stoxx Americas Select Dividend 40 Index, the Dow Jones Stoxx Asia/Pacific Select Dividend 30 Index, the Dow Jones Select Dividend Indexes for Asia, Asia/Pacific, Australia, Canada, France, Germany, Italy, Japan, the Netherlands, Spain, Sweden, U.K. as well as the Dow Jones SWX Select Dividend 20 Index.
As of August 29, the Dow Jones Stoxx Select Dividend 30 Index has a one-year return of 19.57 per cent and a cumulative return of 44.71 per cent since its launch on April 13, 2005.
First Trust has also launched the First Trust FTSE EPRA/Nareit Global Real Estate Index Fund, based on the FTSE EPRA/Nareit Global Real Estate Index, which aims to reflect the stock performance of companies engaged in the North American, European and Asian real estate markets. The Fund invests at least 90 per cent of its total assets in common stocks or American depositary receipts, global depositary receipts or European depositary receipts representing securities in the index.
‘We are pleased to welcome First Trust’s 27th and 28th ETFs to list on the Amex,’ said Scott Ebner, a senior vice-president of the Amex ETF Marketplace. ‘These two new ETFs provide investors with excellent tools to use as interest in global markets keeps growing.’ The new funds bring the number of ETFs listed on the Amex to 339.
Adds Dan Waldron, a senior vice-president and head of ETFs at First Trust: ‘The FTSE EPRA/Nareit Global Real Estate Fund is the first fund of its kind, offering investors a way to own real estate securities from North America, Europe, and Asia. The Dow Jones Stoxx Select Dividend 30 Index Fund provides investors with exposure to some of the most attractive dividend-paying European stocks.’
First Trust Advisors and its affiliate, First Trust Portfolios, are privately-held investment services companies established in 1991 that operate in the US, Canada and Europe. The firms provide services including asset management, financial advisory and municipal and corporate investment banking, and currently have assets under management or supervision of more than USD30bn in closed-ended funds, unit investment trusts, open-ended funds, separately managed accounts and exchange-traded funds.
