LVHD: FRANKLIN U.S. LOW VOLATILITY HIGH DIVIDEND INDEX ETF
ETF Education Report: FRANKLIN U.S. LOW VOLATILITY HIGH DIVIDEND INDEX ETF (LVHD)
What this ETF is trying to do
The LVHD ETF is designed to focus on companies that generally have lower price swings (low volatility) and pay out dividends. It holds a variety of different companies to spread out its exposure.
What the numbers show
When looking at an ETF, it is important to understand two different types of returns: price return (how much the share price changed) and total return (the share price change plus any cash dividends received).
Based on the data provided:
• Year-to-Date (YTD): The price return is approximately 7.14%, while the total return is approximately 9.10%.
• One Year: The price return was approximately 4.71%, and the total return was approximately 8.51%.
• Three Year: The price return was approximately 20.57%, and the total return was approximately 34.80%.
To visualize the price change, we can look at an estimated price from roughly one year ago, which was $40.81. The current price is $42.73.
Income and distribution explanation
This ETF pays out cash to investors, known as distributions. The distribution yield is currently approximately 3.48%. This number tells you how much cash was distributed relative to the current share price.
The ETF usually pays these distributions quarterly, and it has made 5 payments over the last 12 months. It is important to remember that a distribution yield shows cash income, but it is not the same thing as total return.
NAV erosion explanation
"NAV erosion" refers to a situation where the value of the underlying assets in the ETF decreases over time. StockValueFinder uses an erosion-risk score to measure this risk.
For LVHD, the erosion score is 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present. This suggests the fund's value has remained relatively steady rather than steadily declining.
Top Holdings
The following are some of the top companies held in this ETF (note that this is a partial list):
• Johnson & Johnson (2.82%)
• Coca-Cola Co (2.80%)
• Verizon Communications Inc (2.72%)
• U.S. Bancorp (2.69%)
• Kimberly-Clark Corp (2.62%)
• Chevron Corp (2.60%)
Pros
• The ETF has a history of positive total returns over one, three, and five years.
• It provides regular cash distributions.
• The erosion-risk score suggests a stable price trend.
Cons
• High distribution yields can sometimes be misleading if the share price is falling (though that is not currently indicated here).
• The list of holdings provided is only a partial view of the total 117 holdings.
Beginner takeaway
When looking at LVHD, notice the difference between the price return and the total return. The total return is higher because it includes the cash dividends paid out to investors. Always look at both numbers to see how much value an ETF is actually creating over time.
Top Holdings
Structured portfolio holdings supplied by the ETF data provider. These figures are not generated by the AI article.
| # | Holding | Ticker | Weight |
|---|---|---|---|
| 1 | JOHNSON & JOHNSON | JNJ | 2.82% |
| 2 | COCA-COLA CO | KO | 2.80% |
| 3 | VERIZON COMMUNICATIONS INC | VZ | 2.72% |
| 4 | U.S. BANCORP | USB | 2.69% |
| 5 | KIMBERLY-CLARK CORP | KMB | 2.62% |
| 6 | CHEVRON CORP | CVX | 2.60% |
| 7 | PEPSICO INC | PEP | 2.56% |
| 8 | THE HOME DEPOT INC | HD | 2.53% |
| 9 | MCDONALD'S CORP | MCD | 2.51% |
| 10 | LOCKHEED MARTIN CORP | LMT | 2.40% |