The ProShares S&P Technology Dividend Aristocrats ETF (TDV) made its debut on 11/05/2019, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Because the fund has amassed over $265.55 million, this makes it one of the average sized ETFs in the Technology ETFs. TDV is managed by Proshares. Before fees and expenses, TDV seeks to match the performance of the S&P TECHNOLOGY DIVIDEND ARISTOCRATS INDX.
The S&P Technology Dividend Aristocrats Index targets companies from information technology, internet and direct marketing retail, interactive home entertainment, and interactive media and services segments of the economy.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.45%, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 0.99%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector - about 80.6% of the portfolio. Industrials and Financials round out the top three.
Looking at individual holdings, Lam Research Corp (LRCX) accounts for about 3.62% of total assets, followed by Monolithic Power Systems Inc (MPWR) and Oracle Corp (ORCL).
TDV's top 10 holdings account for about 29.24% of its total assets under management.
Performance and Risk
So far this year, TDV has added about 17.35%, and it's up approximately 17.6% in the last one year (as of 11/04/2025). During this past 52-week period, the fund has traded between $62.35 and $89.95.
The ETF has a beta of 1.10 and standard deviation of 19.65% for the trailing three-year period. With about 39 holdings, it has more concentrated exposure than peers .
Alternatives
ProShares S&P Technology Dividend Aristocrats ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
iShares Core Dividend Growth ETF (DGRO) tracks Morningstar US Dividend Growth Index and the Vanguard Dividend Appreciation ETF (VIG) tracks NASDAQ US Dividend Achievers Select Index. iShares Core Dividend Growth ETF has $34.32 billion in assets, Vanguard Dividend Appreciation ETF has $97.88 billion. DGRO has an expense ratio of 0.08% and VIG changes 0.05%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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ProShares S&P Technology Dividend Aristocrats ETF (TDV): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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