Cambria Launches Foreign Shareholder Yield ETF (FYLD); SPDR Goes Beyond BRIC (EMBB)

ETF Database

U.S. equities edged lower this week as the prospect of a pullback in the central bank’s bond-buying program weighed heavily on the markets. In economic news, the ISM manufacturing index rose to 57.3 in November from the previous 56.4; the ISM non-manufacturing index was reported to have expanded in November at a slower pace than expected. Meanwhile, 215,000 private sector jobs were added last month, up from 130,000 in October and above the expected 178,000. The Commerce Department also reported initial jobless claims falling more than expected [see The Fed Effect: How Monetary Policy Impacts Your ETFs].

On the ETF front, investors welcomed two new exchange traded products:

A New International Dividend Fund

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Dividend ETFs

California-based Cambria debuted its second ETF this week – a twist on its existing Shareholder Yield ETF:

  • Foreign Shareholder Yield ETF (FYLD): This fund tracks the Cambria Foreign Shareholder Yield Index, which consists of stocks with high cash distribution characteristics. The underlying index selects stocks from foreign developed countries with market capitalizations over $200 million. Similar to its U.S.-focused counterpart SYLD, FYLD focuses on companies with both attractive dividend payments and net share repurchases. The resulting portfolio consists of 100 individual holdings, with large-, mid- and small-cap firms each accounting for one-third of the portfolio. Industrials, financials, and consumer discretionary stocks make up a significant portion of the portfolio, though meaningful exposure is allocated toward energy, materials, and consumer staples. In regard to country allocations, Canadian and Japanese equities account for more than one-third of total assets; FYLD also features exposure to stocks from Australia, the UK, Germany, and Sweden [see Invest With Principles: Inside The International Equity Fund (VIDI)].
FYLD’s Competition

The new FYLD charges 0.59%  in annual expense fees and faces steep competition in the dividend space. In the Foreign Large Cap Equities ETFdb Category, there are several popular ETFs that also have a focus on dividends:

  • iShares International Select Dividend ETF (IDV, B+), which has $2.9 billion in assets under management.
  • SPDR S&P International Dividend ETF (DWX, B+), which has over $1.3 billion in AUM.
  • Intl Dividend Achievers (PID, B+), which has an average daily volume of over 164,000
Going Beyond BRICS

Industry veteran State Street SPDR also added a new fund to its impressive lineup:

  • MSCI EM Beyond BRIC ETF (EMBB): This fund tracks the MSCI EM Beyond BRIC Index, which is designed to measure the performance of emerging market equities, excluding stocks from Brazil, Russia, India, and China. The fund currently hold over 200 individual holdings, the majority of which are financial stocks. IT, materials, and consumer goods are also given meaningful allocations. EMBB currently allocated roughly 15% each to stocks form South Korea, Taiwan, and South Africa; the fund also provides meaningful exposure to equities from Mexico, Malaysia, Thailand, Indonesia, and Turkey [see BRIC ETFs Take a Beating in 2013].
EMBB’s Competition

State Street’s EMBB charges 0.55%  in annual expense fees, which is slightly below the Emerging Markets Equities ETFdb Category’s average. Currently there is only one fund that specifically targets ex-BRIC emerging market countries: EG Shares‘ Beyond BRICs ETF (BBRC, B-), which has roughly $19.4 million in assets.

Follow me on Twitter @DPylypczak.

Disclosure: No positions at time of writing.

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