ETFS launches global dividend fund

ETF Securities has listed a global dividend ETF on the London Stock Exchange, providing exposure to 100 companies across 10 sectors and up to 25 countries.

The ETFX Global Dividend Fund is synthetically replicated, as with all products on the ETF Exchange equity platform, using a multi-counterparty swap model.

The ETF tracks a Dow Jones net total return index, meaning dividends are automatically reinvested.

ETFS says the mean historical dividend yield on the underlying benchmark stands at 5.74%, calculated monthly since September 2007.

The 100 constituents of the index are subject to screening on both dividend quality and liquidity. Requirements include a non-negative dividend-per-share growth rate over the past five years and a minimum three-month daily average trading volume of $3m.

The index is subject to a review on a quarterly basis, when components are evaluated on their ability to sustain appropriate dividend programmes, but any company that eliminates its dividend or lowers it below a certain value is removed immediately.

President at Dow Jones Indexes, Michael Petronella, says the Select Dividend index family is designed to give investors focused windows on the performance of dividend-paying stocks across the world.

He adds: "Tracking dividend payers is becoming an increasingly important part of effective portfolio management for both individuals and investors."

The ETFX Global Dividend Fund is trading at a total expense ratio of 0.50%.