USDV
SPDR S&P US Dividend Aristocrats ESG UCITS ETF (Dist)
Published by Radif Partners · Updated
Overview
SPDR S&P US Dividend Aristocrats ESG UCITS ETF (Dist) (USDV) tracks the S&P ESG High Yield Dividend Aristocrats index and holds its constituents directly, a physical replication managed by SPDR. Dividends are paid out to holders rather than reinvested, so USDV suits investors seeking regular income. The fund is domiciled in IE, which determines the withholding tax treatment applied to its dividends. Annual charges come to 0.35% of assets, and the fund holds 900M under management. Over five years the fund returned 5.2% a year on average, against 8.3% over three years. It is not eligible for the French PEA, but can be held in a securities account, a UK ISA or a German Depot. Its risk level is rated medium. Launched on 2019-11-08, the fund is denominated in USD and has 7 years of track record. It is a UCITS fund, so it follows the European framework on diversification, liquidity and asset segregation. Because USDV distributes, every payment is taxable in the year it is received, against the dividend allowance in a general account, while it stays sheltered inside an ISA or a SIPP. Domicile in IE sets the withholding the fund itself suffers on the dividends it receives, a cost absent from the stated fee but present in the return.
Ongoing charges of 0.35% place this fund 9th of 21 comparable funds, whose median is 0.35%. On £10,000 that costs about 35 a year and 350 over ten years at a constant amount, deducted daily and never visible on a statement: it shows up in the gap between the fund's return and its index's. At this level, neither low enough to be an argument nor high enough to be an obstacle, the decision rests elsewhere: on the index tracked, on the distribution policy, and on what your broker charges to buy.
Replication is physical: the fund actually holds the constituents of S&P ESG High Yield Dividend Aristocrats, which makes its contents verifiable line by line in the issuer's report. Two points deserve attention. Securities lending first, practised by most physical funds to reduce costs: it earns a few hundredths of a point and creates an exposure to the borrower, covered by collateral, with the annual report stating the proportion lent. Rebalancing second: every change in the index's composition forces the fund to buy and sell, and those internal costs are not in the 0.35% headline. That is why two funds at the same price do not track their index with the same fidelity.
The domicile, Ireland, is not an administrative detail: it determines the withholding tax the fund suffers on the dividends it receives, and that loss appears in no fee table. On US equities, the Ireland-US treaty cuts withholding from thirty to fifteen per cent, which on a world index is mechanically worth several tenths of a point a year and explains Irish dominance of this segment. For the holder, the UCITS framework also brings the key information document in their own language, diversification rules, and separation of the fund's assets from the issuer's.
Income is distributed: the fund pays out the dividends it receives, usually one to four times a year. For a holder living off the portfolio that is what is wanted, since the income arrives without selling. For someone still accumulating it is a tax disadvantage in a taxable account: each payment is taxed in the year received, so the amount reinvested is reduced before it starts working again. Reinvesting by hand also costs a dealing commission each time and often leaves cash idle for want of the price of a whole unit. An accumulating class on the same index, where one exists, settles the question.
With 900 million in assets and 7 years of history, this fund has the size and the record that make closure unlikely and the spread narrow. Three checks remain, once a year, none of which depends on the market. The ongoing charge, which an issuer revises without notice and whose gap to a competitor can invert. The tracking difference, the only figure that says whether replication stays faithful. And the methodology of S&P ESG High Yield Dividend Aristocrats, which can change its selection or weighting rules without the fund's name moving, in which case what you hold has changed with nothing to announce it.
S&P ESG High Yield Dividend Aristocrats tracks a bond market, which changes the question: the return on a bond portfolio is largely known in advance, as yield to maturity, while its market value moves with rates and with the risk premium demanded of issuers. Two figures govern this fund, duration and average credit quality, and neither appears in an annual return. On corporate credit, correlation with equities rises precisely when protection was expected.
Over one year the fund shows 11.0% against 5.2% annualised over five years: the recent year sits well above the long average. A gap in that direction mainly counsels care about the entry point, since what has risen sharply lately costs more today than a year ago, and the long average is the figure that best describes what to expect.
0.35%
900M
900M USDMedium
148
Physical
Distributing
USD
IE
S&P ESG High Yield Dividend Aristocrats
SPDR
2019-11-08 (6 years)
Contextual Analysis
Fund Size
With 900M in assets, this is a mid-sized fund, decent liquidity for most investors.
Fee Positioning
A TER of 0.35% is in line with the market average (~0.35%).
Track Record
Launched in 2019-11-08, this fund has 6 years of history, enough to evaluate consistency.
Risk Profile
Medium risk, good risk/return balance for a 5+ year horizon.
Performance
Returns Summary
| Period | Ann. Return | Cumulative |
|---|---|---|
| 1 Month (est.) | – | +0.9% |
| 3 Months (est.) | – | +2.6% |
| 6 Months (est.) | – | +5.4% |
| YTD (est.) | – | +4.5% |
| 1 Year | +11.0% | +11.0% |
| 3 Years | +8.3% | +27.2% |
| 5 Years | +5.2% | +29.0% |
| Since inception (6y) | +8.2% | +60.4% |
Key Facts
Fund Profile
Themes & Zones
Holdings
Risk
How to Buy This ETF
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About this ETF
The SPDR S&P US Dividend Aristocrats ESG UCITS ETF (Dist) tracks the S&P ESG High Yield Dividend Aristocrats index. It is managed by SPDR using physical replication and follows a distributing distribution policy. The fund is denominated in USD and domiciled in IE. It has a total expense ratio (TER) of 0.35%.
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Frequently asked questions
What do USDV's 0.35% charges actually cost?
They are taken from the fund's value continuously and never billed separately: on £1,000 invested that is about £3.50 a year and roughly £35 over ten years at a constant amount. That is the only cost of the fund itself. Your broker's commission and the spread between buying and selling price come on top, and they weigh most on small frequent purchases.
Does USDV lend out the securities it holds?
Probably in part: most physical funds lend securities to reduce their costs, and SPDR publishes the proportion in the annual report. Lending income is worth a few hundredths of a point, shared between the fund and the issuer. The risk is the borrower's, covered by collateral worth more than the amount lent, and it appears in the prospectus rather than in the stated fee.
Why does USDV's Irish domicile matter?
Because it determines the withholding tax the fund suffers on the dividends it receives, and that loss appears in no fee table. The Ireland-US treaty cuts withholding from thirty to fifteen per cent on US equities, mechanically worth several tenths of a point a year on a world index. The UCITS framework also brings the key information document in your own language.
Does USDV pay dividends?
Yes: the fund distributes and pays out the dividends it receives, on a calendar set by SPDR. The payment is taxable in the year you receive it in most accounts, even if reinvested at once, and reinvesting by hand costs a commission each time. An accumulating class on the same index avoids that friction for anyone who does not need the income.
What is the real risk in USDV?
Interest rates, not default. When rates rise, the value of bonds already issued falls, and the size of the move depends on the portfolio's duration: roughly one per cent per year of duration per point of rate. The figures to look at on this fund are therefore duration and yield to maturity, which says what the portfolio earns if nothing is sold. Neither appears in an annual return.
This ranking is for informational purposes only and does not constitute a recommendation to buy or sell any security. Displayed performance is simulated.