(RDVY) First Trust Rising Dividend - Ratings and Ratios

The First Trust Rising Dividend Achievers ETF (NASDAQ:RDVY) is designed to provide exposure to companies with a proven track record of consistently increasing their dividends. The fund typically allocates at least 90% of its net assets to the common stocks and depositary receipts that make up its underlying index. This index is crafted to include a mix of small, medium, and large-capitalization companies, ensuring diversification across market sizes.

The ETFs underlying index is built on a specific set of criteria. It targets companies that not only have a history of raising dividends but also demonstrate the financial health to sustain these increases. This includes firms with strong cash reserves, manageable debt levels, and improving earnings. By focusing on these metrics, the index aims to identify companies that are well-positioned for future dividend growth.

As an exchange-traded fund (ETF), RDVY offers investors the ability to gain exposure to this dividend-focused strategy through a single, tradeable instrument. The fund is domiciled in the United States and is categorized under large-value ETFs, reflecting its emphasis on established companies with strong financial fundamentals. With an assets under management (AUM) of approximately $13.7 billion, RDVY is a substantial player in the ETF space, providing liquidity and scale to investors seeking dividend growth opportunities.

Its worth noting that RDVY does not rely on traditional valuation metrics like price-to-earnings (P/E) or price-to-book (P/B) ratios for security selection. Instead, the funds strategy is rooted in the historical and projected ability of its holdings to generate and distribute cash to shareholders. This approach makes it a unique offering for investors seeking to align with companies that prioritize shareholder returns through dividends.