First Trust Morningstar Dividend Leaders Index Fund

FDL

Market cap $7.37B

First Trust Morningstar Dividend Leaders Index Fund offers a 3.87% SEC yield, targeting large-cap, established dividend payers with moderate valuation multiples. FDL's value-oriented sector allocation contrasts sharply with the tech-heavy S&P 500, positioning it for potential mean reversion and defensive income. Despite underperforming the S&P 500 over the past decade, FDL's yield and sector mix make it attractive in times of elevated market valuations and sector imbalances.

High-dividend ETFs are back in focus as geopolitical risks and AI valuation worries push investors toward steady income plays.

Rising bond yields and inflation fears are raising correction risks. Investors may find shelter in quality and value ETFs like QUAL, VTV and VLUE.

First Trust Morningstar Dividend Leaders Index Fund (NYSEARCA: FDL) is up 12.3% year-to-date, moving from about $44 to nearly $50.

Designed to provide broad exposure to the Large Cap Value segment of the US equity market, the First Trust Morningstar Dividend Leaders ETF (FDL) is a passively managed exchange traded fund launched on March 9, 2006.

The First Trust Morningstar Dividend Leaders ETF offers a 4% yield, supported by underlying dividends rather than capital gains or option strategies. FDL's portfolio is heavily weighted toward energy (over 30%), positioning it to benefit from current macro tailwinds and elevated oil prices. While FDL has underperformed the S&P 500 over long horizons, it has outperformed during recent energy market rallies, making it attractive for tactical allocation.

Shifting from higher-risk assets to consistent income sources is a natural progression for retirees.

Move over artificial intelligence. The new AI investors want this year from the S&P 500 is "actual income.

Dividend ETFs like SCHD, FDL, and HDV are outperforming AI and SaaS stocks as investors favor moderate-yielding dividend payers over high-growth tech names.

Five dividend ETFs -- DFJ, SCHD, FDL, HDV and EYLD -- have outpaced SPY in 2026 as investors rotate toward quality income plays.