Research > ETFs > ETF / ETP Commentary > 

This Dog Has Bite: 'SDOG' and the 'Dogs of the Dow'

The ALPS Sector Dividend Dogs ETF (SDOG B) is a prime example of an asset benefiting from this year’s resurgence in value stocks. The good news is that some market observers believe there’s more room to run for previously undervalued names.SDOG tries to reflect the performance of the S-Network Sector Dividend Dogs Index, which applies the “Dogs of the Dow Theory” on a sector-by-sector basis using the S&P 500 with a focus on high dividend exposure. SDOG’s equal-weight methodology is important because it reduces sector-level risk and dependence of some groups that are considered to be imperiled value ideas.“The broad market rally over the past year has now lifted stocks in nearly every sector, and it might be time for investors to focus on finding individual winners to keep growing their portfolios, according to Goldman Sachs,” reports Jesse Pound for CNBC. “The firm’s research analysts said in a note on Wednesday that value investors should, in the current environment, take a closer look at companies’ individual financial results to find some gems.”Healthcare and FinancialsSDOG boasts significant exposure to both the financial and healthcare sectors.Inflation fears have been permeating the markets as of late, especially if the economy bounces back quicker than anticipated amid a vaccination rollout. The Federal Reserve, despite its vow to keep rates low, has hinted that rates could rise should the economic climate warrant the change. A rise in rates could help profits for financials when it comes to loan products.As for healthcare, it’s a tried and true sector that can withstand the ups and downs of most economic environments.“While the backdrop of higher rates, higher inflation breakevens and a steeper yield curve has been supportive, given the run since mid-February and the temporary nature of Value rallies in recent years we expect that fundamentals may play an important role in the sustainability of a further move higher,” writes Goldman Sachs.While they generally have solid fundamentals, value stocks may have lost popularity in the market and are considered bargain-priced compared with their competitors. Value fans believe this time may be different for value stocks, pointing to improving investment sentiment measures, abating fears of a recession, rebounding corporate profits, and lessening trade tensions between the U.S. and China.Other high dividend ETFs include the SPDR S&P Dividend ETF (SDY B), iShares Select Dividend ETF (DVY B+), and iShares Core High Dividend ETF (HDV A-).For more on cornerstone strategies, visit our ETF Building Blocks Channel.

Performance data shown is past performance and is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. Yield and return will vary, therefore you have a gain or loss when you sell your shares. For standard quarterly performance, go to the fund's Snapshot page by clicking on the ETF/ETP's symbol.

ETFs may trade at a premium or discount to their NAV and are subject to the market fluctuations of their underlying investments.

For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Please note, this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral. Additional information about the sources, amounts, and terms of compensation can be found in the ETF's prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock, Inc. and its affiliates.

FBS receives compensation from the fund's advisor or its affiliates in connection with a marketing program that includes the promotion of this security and other ETFs to customers ("Marketing Program"). The Marketing Program creates incentives for FBS to encourage the purchase of certain ETFs. Additional information about the sources, amounts, and terms of compensation is in the ETF's prospectus and related documents. Please note that this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral.

News, commentary (including "Related Symbols") and events are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.

Any data, charts and other information provided on this page are intended to help self-directed investors evaluate exchange traded products (ETPs), including, but limited to exchange traded funds (ETFs) and exchange traded notes (ETNs). Criteria and inputs entered, including the choice to make ETP comparisons, are at the sole discretion of the user and are solely for the convenience of the user. Analyst opinions, ratings and reports are provided by third-parties unaffiliated with Fidelity. All information supplied or obtained from this page is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell a particular security, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating ETPs. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation and other individual factors and re-evaluate them on a periodic basis.

Before investing in any exchange traded product, you should consider its investment objective, risks, charges and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.