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Small-Cap Dividend Growers ETF (SMDV) Hits New 52-Week High

Sanghamitra Saha
Updated
Wall Street finished in the green reversing its five-day negative trend on Thursday following news that United States and China have ramped up their efforts to resolve lingering trade disputes

For investors seeking momentum, Russell 2000 Dividend Growers ETF (SMDV) is probably on radar now. The fund just hit a 52-week high and is up over 14.5% from its 52-week low price of $51.18 per share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

SMDV in Focus    

The fund tracks the Russell 2000 Index and have increased dividend payments each year for at least 10 years. Utilities (24.94%), Industrials (14.07%), Financials (12.01%) and Consumer Staples (11.49%) take top four spots in the index. The product charges 40 bps in fees (see all Small Cap ETFs here).

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Why the Move?

Small-cap stocks are more domestically-focused and thus not exposed to geopolitical risks and negative currency translations. Both criteria enabled small-cap stocks to cash in on an improving U.S. economy while dodging tensions stemming from trade war and a rising dollar. However, given the recent rally in the small-cap space, overvaluation concerns are sure to come. This is why investors probably tapped a quality ETF like Dividend Growers in the small-cap segment.

More Gains Ahead?

The fund has a Zacks ETF Rank #3 (Hold) with a medium risk outlook. It seems that this fund can be exercised a little further as evident by the positive weighted alpha of 9.50.

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PRO-SH R2000 DG (SMDV): ETF Research Reports
 
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