iShares Asia / Pacific Dividend 30 Index Fund Exchange Traded Fund (ARCA: DVYA)

Latest news for iShares Asia / Pacific Dividend 30 Index Fund Exchange Traded Fund (ARCA:DVYA)

iShares Asia / Pacific Dividend 30 Index Fund Exchange Traded Fund

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The Fund seeks to track the investment results of the Dow Jones Asia/Pacific Select Dividend 50 Index (the Underlying Index), which measures the stock performance of high dividend paying companies listed in Australia, Hong Kong, Japan, New Zealand and Singapore. The Underlying Index measures the performance of a selected group of equity securities, excluding real estate investment trusts (REITs), issued by companies that have provided relatively high dividend yields on a consistent basis. Dividend yield is calculated using a stocks indicated annual dividend (not including any special dividends) divided by its price.

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Beata Manthey, Citigroup Inc.’s (NYSE: C) head of equity strategy, doubled down on the bank’s bullish stance for global and in particular emerging market equities Wednesday, despite almost a year-long sell-off in the sector.

Emerging Market Shares Look &#34;Very Cheap&#34; While Tech Stocks Are Also A Buy, Says Citi Analyst

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Beata Manthey, Citigroup Inc.&rsquo;s (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/C#NYSE">C</a>) head of equity strategy, doubled down on the bank&rsquo;s bullish stance for global and in particular emerging market equities Wednesday, despite almost a year-long sell-off in the sector.

She also said that the bank had been buying up tech stocks as fears of effects of a US recession now look overblown. She made the comments on an <a href="https://www.bloomberg.com/news/articles/2023-10-11/global-funds-exit-em-asia-stocks-in-longest-streak-in-16-months?srnd=premium-asia" style="color:#0563c1">interview</a> on Bloomberg TV Wednesday.

&ldquo;Putting geopolitics aside, the macroeconomic risk or the balance of the risks [of investing in global equities] has improved,&rdquo; said Manthey.

&ldquo;I don&rsquo;t want to sound overly bullish as the data still looks bad, but it looks less bad than what we thought it would so the global economy will continue to improve despite these risks more than we expected it to do.&rdquo;

Among emerging market stocks there has been a $1.8 trillion sell-off this year, taking stocks to their lowest levels vs. the S&amp;P 500 since the 1980s. Manthey said that this made emerging market companies particularly attractive to Citi&rsquo;s bargain hunters right now.

&ldquo;They look very cheap and this is part of our strategy. We&rsquo;ve been overweight the US all summer &hellip; now it&rsquo;s time to move to more cyclical markets,&rdquo; she said.

&ldquo;Going forward, you should be buying into the more underperforming [markets] and markets [that are] depressed from a valuation standpoint.&rdquo;

The iShares Asia 50 ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AIA#NASDAQ">AIA</a>), iShares Asia/Pacific Dividend ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DVYA#NYSE">DVYA</a>), iShares Emerging Markets Dividend ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DVYE#NYSE">DVYE</a>) and iShares Emerging Markets Infrastructure ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/EMIF#NASDAQ">EMIF</a>) are all lower year-to-date vs. a rise of 14% for SPDR S&amp;P 500 ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) and 2% for Dow Jones Industrial Average ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DIA#NYSE">DIA</a>) in the same period.

While geopolitical problems, in particular the Israel-Palestine war, would continue to present risks to global stock investors, Manthey said that &ldquo;the market always weighs the balance of the risks&rdquo; and as such most of the downside is already priced into stock values.

With respect to interest rates, Manthey cautioned that it was &ldquo;overly-optimistic&rdquo; to say that the Federal Reserve and other central banks around the world would be easing monetary police any time soon.

Citi has recently put an underweight weighting on energy stocks as a result of its concerns over global growth in the face of these sustained higher rates. However, with the situation in Gaza, Manthey conceded that call may turn out to be the bank&rsquo;s most &ldquo;at risk&rdquo; one, as oil producers such as Exxon Mobil Corp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XOM#NYSE">XOM</a>), Shell PLC (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SHEL#NYSE">SHEL</a>), Chevron Corporation (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CVX#NYSE">CVX</a>), Conoco Phillips (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/COP#NYSE">COP</a>) and BP plc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BP#NYSE">BP</a>) get a boost from higher prices due to the escalating conflict.

Manthey added that Citi has now turned bullish on tech, after previously being underweight on the sector as a result of concerns about the state of the US economy.

Last year, Citi thought that tech stocks were overbought relative to the underlying US recessionary concerns, but it has now reversed that position and is buying back in.

Year-to-date, Apple Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>), Microsoft Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) and Alphabet Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) are all over 40% higher, while Meta Platforms Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) and Nvidia Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) have surged over 1.5 times and over 2 times, respectively, but dipped last month in a sell-off.

&ldquo;Tech has proven more resilient than thought and we think the sector looks oversold so we bought back into it a week ago,&rdquo; said Manthey. &nbsp;

Emerging Market Shares Look "Very Cheap" While Tech Stocks Are Also A Buy, Says Citi Analyst

Dividend season is in full effect for the majority of equity <a href="http://www.benzinga.com/topic/etfs">ETFs</a> that pay quarterly distributions. The last week of every quarter generally brings a declaration of income from the underlying basket of companies that have generated dividends over the last 90 days.

	The process can lead to confusing price action for funds with high dividend yields that appear to be decoupling from their benchmark for a single day.

	This event is known as the dividend &ldquo;ex-date,&rdquo; which is the day that the amount of the dividend is subtracted from the net asset value of the ETF. The income will then be paid in cash shortly thereafter to shareholders of record prior to that date.&nbsp;

	Related Link: <a href="http://www.benzinga.com/etfs/specialty-etfs/14/09/4870232/deutsche-awm-celebrates-3-year-anniversary-of-currency-hedged-etfs">Deutshce AWM Celebrates 3 Year Anniversary Of Currency Hedged ETFs</a>

	Not surprisingly, the ETFs that will feel the biggest change in price as a result of this income are the funds with the largest quarterly distributions, which generally includes high yield asset classes such as mortgage <a href="http://www.benzinga.com/topic/REITs">REITs</a>, <a href="http://www.benzinga.com/topic/mlp">master limited partnerships</a>, and business development companies.&nbsp;

	For example, the iShares FTSE NAREIT Mortg.REITIn Fd ETF (NYSE: <a class="ticker" href="/stock/rem#NYSE">REM</a>) has a 30-day SEC yield of 9.35 percent and announced a significant quarterly distribution of $0.31 per share. With the price of REM hovering near $12, this amounted to a single day impact of 2.5 percent.

	Mortgage REITs are notorious for generating high yields by borrowing short-term term debt at low rates and using the money to purchase long-term mortgage bonds. The spread between the two is generally used to determine how profitable the REIT is and how much income it will distribute to shareholders.&nbsp;

	In addition, many international dividend indexes can pay substantial income during this quarterly cycle as well.

	The iShares Asia/Pacific Dividend ETF (NYSE: <a class="ticker" href="/stock/dvya#NYSE">DVYA</a>) recently declared a distribution of $1.02 per share, which translated to single-day adjustment of more than 2 percent as well.&nbsp; This ETF tracks exposure to high quality dividend paying companies in Australia, <a href="http://www.benzinga.com/topic/Japan">Japan</a>, Hong Kong, and New Zealand.&nbsp;

	It&rsquo;s also worth noting that many international ETFs are known to distribute lumpy income streams as part of their differing fiscal years and special distributions. This can impact yield statistics over varying time frames and is in sharp contrast to the relatively smooth dividend payments of domestic ETFs.

	ETF investors should always keep in mind that dividends need to be calculated back into performance to track the total return of each fund.&nbsp; This will allow you to view a complete picture of the price and income components over time.

This year may well turn out to be the year of the dividend. In the first quarter, dividend increases by U.S. companies totaled $14.5 billion, <a href="http://online.wsj.com/article/PR-CO-20130410-910107.html">according to Standard &amp; Poor&#39;s</a>. During the quarter, 944 dividend increases were reported, up from 677 in the first quarter of 2012, said S&amp;P.

	Those 944 increases far outpaced the 135 negative dividend actions seen in the quarter. While some talk of dividend insanity and a crowded, overheating market for dividend ETFs, investors are ignoring the noise.

	Dividend ETFs attracted $3.4 billion in assets in April, a monthly record high, and through the end of the month had hauled in $10.9 billion year-to-date, <a href="http://www.benzinga.com/markets/bonds/13/05/3553630/bond-etf-inflows-surge-in-april">according to BlackRock data</a>.

	International dividend ETFs are part of this equation, too. In fact, several new global dividend ETFs <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/04/3502125/a-new-international-dividend-etf-comes-to-town">came to market last month</a>, adding to a growing menu of options for income investors that want some non-U.S. exposure.

	FlexShares International Quality Dividend Dynamic Index Fund (NYSE: <a class="ticker" href="/stock/iqdy#NYSE">IQDY</a>) 
	The FlexShares International Quality Dividend Dynamic Index Fund is among the newest addition to the global dividend ETF fray as the ETF is not yet a month old. IQDY is part of a trio of <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/04/3505338/this-new-etf-gets-defensive-with-global-dividends">global dividend ETFs</a> launched by Northern Trust (NASDAQ: <a class="ticker" href="/stock/ntrs#NASDAQ">NTRS</a>) last month.

	IQDY, which has annual expense ratio of 0.47 percent, does things differently than some other dividend ETFs. For example, this ETF does not rank and weight its holdings based on length of dividend increase streaks. Rather, constituent companies are included in IQDY&#39;s index are selected based on expected dividend payment and fundamental factors such as profitability, solid management and reliable cash flow, <a href="http://www.flexshares.com/exchange-traded-funds/international-quality-dividend-dynamic-index-fund">according to the issuer</a>.

	At less than a month old, IQDY may be too new for some investors, but the ETF has gained 4.6 percent and attracted $2.6 million in assets since its debut. The U.K. is IQDY&#39;s largest country weight, but Japan and Australia combine for over 21 percent. That is an attractive point given how well those equity markets have performed this year.

	iShares Asia/Pacific Dividend 30 Index Fund (NYSE: <a class="ticker" href="/stock/dvya#NYSE">DVYA</a>) 
	Speaking of Australia and Japan, the iShares Asia/Pacific Dividend 30 Index Fund features an allocation of 45.3 percent to the former and 12.6 percent to the latter. Singapore (18.6 percent), Hong Kong (12.5 percent) and New Zealand (10.5 percent) are DVYA&#39;s other constituent countries.

	That lineup, comprised of 33 not 30 stocks, implies DVYA is a decent idea for conservative investors. For starters, the fund is obviously not heavy on emerging markets exposure. Second, over 76 percent of the ETF&#39;s weight is allocated to countries with AAA sovereign credit ratings &ndash; Australia, Singapore and Hong Kong.

	Third, DVYA follows a similar sector allocation strategy as many U.S.-focused dividend ETFs as telecom and consumer staples combine for 41 percent of the fund&#39;s weight. Financials are the largest sector weight at 23.9 percent.

	DVYA has just $45.9 million in assets, a number that is surprisingly small given its trailing 12-month yield of 4.13 percent and year-to-date gain of over 11 percent.

	iShares Emerging Markets Dividend Index Fund (NYSE: <a class="ticker" href="/stock/dvye#NYSE">DVYE</a>) 
	The iShares Emerging Markets Dividend Index Fund is example of a compelling global dividend ETF where it is fair to wonder why the fund is not larger, though DVYE eclipses the much ballyhooed $100 million in AUM mark with $141.6 million.

	DVYE has been a slack performer on a year-to-date basis with a 5.8 percent decline, but things may be starting to look up for the 15-month old fund as it has gained 2.2 percent in the past month. A roughly 36 percent combined allocation to financials and materials names may imply DVYE is a high beta play, but utilities, telecom and consumer goods combine for 37 percent. That helps DVYE&#39;s beta against the S&amp;P 500 reside at 0.88, <a href="http://us.ishares.com/product_info/fund/overview/DVYE.htm?fundSearch=true&amp;qt=DVYE">according to iShares data</a>.

	DVYE&#39;s largest country weights are Taiwan (27 percent) and Brazil (15 percent), but DVYE&#39;s <a href="http://tools.ishares.wallst.com/Tools/PCT/CC/Matrix.ashx?indices=">correlation to the marquee Taiwan and Brazil ETFs</a> is relatively low. Additionally, DVYE&#39;s standard deviation of 9.75 percent over the past 11 months is nearly 500 basis points below that of the iShares MSCI Taiwan Index Fund (NYSE: <a class="ticker" href="/stock/ewt#NYSE">EWT</a>) and almost 1,000 basis points below that of the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>).

	Turkey, South Africa and China round out the top-five country weights. Or investors can just focus on the seductive 7.21 percent 30-day SEC yield.

	For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

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iShares Asia / Pacific Dividend 30 Index Fund Exchange Traded Fund

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