O'Leary's O'Shares Triples The Size Of Its ETF Stable

Few if any exchange traded funds come to market backed by the star power of the O'Shares FTSE US Quality Dividend ETF OUSA.

The O'Shares FTSE US Quality Dividend ETF, which debuted in mid-July, represented the first move into the booming ETF space by Shark Tank” star Kevin O’Leary. O’Shares was formed by Connor O’Brien, CEO, and ABC Shark Tank investor Kevin O’Leary, Chairman, who together also co-founded O’Leary Funds.

On Wednesday, O'Shares tripled the size of its ETF lineup, adding two more dividend funds to its stable. The O'Shares FTSE Europe Quality Dividend ETF OEUR adheres to the same principles as OUSA, namely an emphasis on quality, large-cap dividend payers with a penchant for low volatility. OEUR tracks the FTSE Europe Qual / Vol / Yield Factor 5% Capped Index.

That index “is designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in Europe that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield, as determined by FTSE-Russell (the “Index Provider”). The high quality and low volatility requirements are designed to reduce exposure to high dividend equities that have experienced large price declines, as may occur with some dividend investing strategies,” according to O'Shares.

British and Swiss stocks combine for nearly 63 percent of OEUR's weight, which in a Europe-focused dividend ETF is not surprising. The U.K. is the second-largest developed market dividend destination after the U.S. in terms of dividends paid while Switzerland, by way of familiar large caps such as Roche, Nestle SA NSRGY and Novartis AG NVS, has displayed some of the most dependable ex-U.S. developed markets dividend growth.

In addition to Novartis, Nestle and Roche, OEUR's other top 10 holdings include Royal Dutch Shell Plc (NYSE: RDS-A) and AstraZeneca Plc AZN. At 12.9 percent, France is the only other country with a double-digit weight in OEUR. 

OUSA and OEUR have an Asia counterpart in the form of the O'Shares FTSE Asia Pacific Quality Dividend ETF OASI. OASI follows the FTSE Asia Pacific Qual / Vol / Yield Factor 5% Capped Index.

That index “is designed to measure the performance of publicly-listed large-capitalization and mid-capitalization dividend-paying issuers in the Asia Pacific that meet certain requirements for market capitalization, liquidity, high quality, low volatility and dividend yield, as determined by FTSE-Russell (the “Index Provider”). The high quality and low volatility requirements are designed to reduce exposure to high dividend equities that have experienced large price declines, as may occur with some dividend investing strategies,” according to O'Shares. 

Although Japan is historically low-yielding and far from the most impressive developed market dividend spot, that is changing as investors push for cash-rich Japanese firms to raise dividends, so it could prove beneficial that OASI allocates nearly 44 percent of its weight. Not surprisingly, the new ETF is heavily allocated to Australian stocks (23.3 percent). Australia is historically one of the highest-yielding developed markets.

Both of the new O'Shares ETFs charge 0.58 percent per year, or $58 per $10,000 invested.