What SDY actually is

SDY follows the S&P High Yield Dividend Aristocrats Index. To qualify, a company must have raised its dividend every year for at least 20 years.

What is inside

Established companies across consumer staples, industrials, utilities, financials and health care. The index weights by yield, with limits so no single name dominates.

Distributions

SDY pays quarterly. The yield is usually moderate. Because it only holds companies with a long record of increases, its income has tended to grow over time.

What to keep in mind

  • Record is not a promise. A long streak can end.
  • Sector tilt. Little technology.
  • Overlap. Similar to other dividend-growth funds.

Quick take

SDY is a classic dividend-growth fund. Compare it with NOBL and VIG to see how the rules differ.