![]() ![]() This high concentration in only a handful of stocks means that its fund price can be quite volatile. In fact, its top 10 holdings represent nearly 72% of its total portfolio. VOX’s top 5 holdings represents about 53% of its total portfolio. ![]() Instead, VOX should be treated as an ETF that focuses on growth as well as some dividend growth.įund performance can be quite volatile due to higher concentration in fewer stocks Income investors should keep in mind that VOX should not be considered as a dividend ETF anymore. This is much lower than the 4% yield in the first half of 2018. As can be seen from the chart, VOX’s dividend yield (trailing 12 month) has declined to 1.6%. As a result, VOX’s dividend yield is now less attractive. ![]() There are more growth stocks in the portfolio instead of only dividend stocks. However, the implementation of the GICS sector classification in September 2018 has resulted in a change in the portfolio mix of VOX. Traditionally, telecom stocks have much higher dividend yields. The inclusion of growth companies such as Facebook, Google, Netflix, and Electronic Arts in VOX means that investors should expect higher capital appreciation in this ETF.ĭividend yield not as attractive as before On the other hand, traditional telecom stocks such as AT&T ( T) and Verizon ( VZ ) saw EPS decline by 21.4% and 17.8% in the past 5 years respectively. As can be seen from the chart below, companies such as Electronic Arts ( EA) and Facebook have grown EPS by more than 830% and 620% in the past 5-years. These are also stocks that are now included in VOX’s portfolio of stocks. This inclusion of several e-commerce stocks also means that there are more growth stocks in the portfolio.Į-commerce companies such as Facebook, Alphabet, and Netflix has grown rapidly in the past few years. This inclusion was due to the GICS sector classification implemented in September 2018. These companies have better growth profile than traditional telecom companies. Instead, VOX also includes other services company that are usually categorized in the e-commerce or media sectors such as Facebook, Alphabet, Netflix, or The Walt Disney Co ( DIS). VOX does not only hold traditional telecommunications stocks such as AT&T ( T), Verizon ( VZ), or T-Mobile ( TMUS). We believe VOX is suitable for investors with a long-term horizon seeking capital appreciation and some dividend growth. Its inclusion of these growth stocks also means that its fund performance can be volatile as these stocks have higher concentration in VOX’s portfolio. As such, the fund should now be seen as an ETF that offers growth and some dividend instead of a purely dividend ETF. With the implementation of the GICS sector classification in September 2018, the stock now also includes several high-profile growth stocks in the technology sector such as Google ( GOOGL), Facebook (FB) and Netflix ( NFLX). Investable Market Communication Services Index. Vanguard Communication Services ETF ( NYSEARCA: VOX) owns a portfolio of U.S. ![]()
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