Over the previous 12 months, Capital Group Dividend Worth (CGDV) sports activities the most effective returns within the Kiplinger ETF 20, our favourite exchange-traded funds. Its 33% one-year return via Might beat the S&P 500 in addition to 88% of its friends (funds that concentrate on large-cap shares buying and selling at worth costs).
The exchange-traded fund goals to generate an above-market-average dividend yield by specializing in high-quality U.S. firms — 90% of the portfolio holdings should be shares of firms with investment-grade credit score rankings, and 90% should pay dividends. The fund at present yields 1.3%; the S&P 500, 1.1%.
The end result, says fund comanager Chris Buchbinder, is an ETF that usually participates in bullish stretches — although it might not sustain with the broad market — and outperforms throughout sell-offs.
Join Kiplinger’s Free Newsletters
Revenue and prosper with the most effective of skilled recommendation on investing, taxes, retirement, private finance and extra – straight to your e-mail.
Revenue and prosper with the most effective of skilled recommendation – straight to your e-mail.
“Corporations that pay dividends have extra constant money flows, a stronger monetary profile and are extra resilient during times of market weak spot,” he says. Every of the ETF’s 5 managers and a bunch of analysts independently run a chunk of the fund’s property. Over the previous three years, the fund’s 26% annualized return beat 98% of its friends and the S&P 500.
Managers made a well timed transfer throughout the 2025 tariff tantrum
Through the “Liberation Day” tariff-related sell-off in April 2025, CGDV managers loaded up on semiconductor and semiconductor-related shares that had fallen dramatically, together with Nvidia (NVDA) and Applied Materials (AMAT).
Back then, Nvidia shares hit an intraday low of $87 and it now trades at more than $200. Other chip company stocks rebounded sharply, too. Over the past 12 months, the S&P 500 industry index of semiconductor and semiconductor-related stocks soared 107%.
Before last year’s sell-off, the fund had a “relatively modest” exposure to the information technology sector, says Buchbinder. (The sleeve of assets he manages had 0% in tech back then, he notes.) But now, the sector makes up 34% of the portfolio. Don’t expect that tilt to change much.
“There’s still opportunity in some of these AI semiconductor-related companies and software companies,” Buchbinder says.
Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.
