First Trust NASDAQ Technology Dividend Index Fund

TDIV

Market cap $3.78B

Many investors don't readily think of dividends and tech together, but there's more than meets the eye with this union.

First Trust NASDAQ Technology Dividend Index Fund (TDIV) offers risk-averse investors tech exposure with lower valuations and more mature, dividend-paying companies. TDIV's defensive approach delivers similar returns to growth-focused peers like VGT, with lower volatility, better diversification, and a modest yield advantage after expenses. The ETF is more concentrated in semiconductors and telecom, spreads top holdings better than VGT, and maintains a lower P/E and P/B ratio.

These ETFs are great for investors who want both dividends and growth. All of these ETFs have outperformed the S&P 500's total return.

Investing in tech is essential for strong returns, but volatility deters risk-averse investors. TDIV ETF provides lower-risk access to tech by focusing on dividend-paying, established companies. The ETF offers diversification across 90 tech stocks, reducing single-stock risk and enhancing portfolio stability.

Dividend ETFs like TDV, TDIV, and GCOW are hitting 52-week highs as market volatility has boosted demand for steady income.

First Trust NASDAQ Technology Dividend Index Fund warrants a sell rating due to its suboptimal performance compared to specialized tech and dividend ETFs. TDIV's long-term share price return lags tech-focused ETFs like VGT, while costing investors with higher fees through its expense ratio. A mix of VGT (25%) and SCHD (75%) offers superior capital appreciation, higher dividend yield, and lower overall fees compared to TDIV.

TDIV: Caught In The Middle

The S&P 500 dividend yield of 1.18% is the lowest since February 2001 , according to a Nov.

Beating the market and providing above-market income are two things that don't always go together, but that's the case with these three ETFs in 2024. These funds are beating out the just over 23% return of the SPDR S&P 500 ETF Trust NYSEARCA: SPY, which tracks the S&P 500 and provides dividend income above its 1.2% yield.

TDIV invests in technology dividend stocks, offering a 1.6% yield but underperforming other tech funds due to its tilt towards value. The fund's portfolio is heavily weighted towards large-cap value stocks, which are more stable but have weaker growth profiles. While TDIV has a history of growing dividends, its total return lags behind other technology ETFs like Vanguard Information Technology ETF and Technology Select Sector SPDR ETF.