Blending income and contained volatility, the Franklin U.S. Low Volatility High Dividend Index ETF ( LVHD ) is among the dividend funds offering yields above 3%, which are becoming increasingly appealing as the interest rate easingAnalyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation fo ...

Core Insights - The Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) is designed to provide broad exposure to the Style Box - Large Cap Value category, launched on December 28, 2015 [1] Fund Overview - LVHD is sponsored by Franklin Templeton Investments and has assets exceeding $584.78 million, positioning it as an average-sized ETF in its category [5] - The fund aims to match the performance of the QS Low Volatility High Dividend Index, focusing on profitable U.S. companies with high dividend yields and lower price and earnings volatility [5] Cost Structure - The annual operating expenses for LVHD are 0.27%, which is competitive within its peer group [6] - The ETF has a 12-month trailing dividend yield of 3.34% [6] Sector Allocation and Holdings - The ETF has a significant allocation in the Utilities sector, comprising approximately 24.9% of the portfolio, followed by Consumer Staples and Real Estate [7] - Cisco Systems Inc (CSCO) represents about 2.65% of the fund's total assets, with the top 10 holdings accounting for roughly 25.11% of total assets [8] Performance Metrics - As of August 13, 2025, LVHD has increased by about 7.67% year-to-date and approximately 10.71% over the past year [10] - The fund has traded between $37.37 and $41.26 in the last 52 weeks, with a beta of 0.66 and a standard deviation of 13.37% over the trailing three-year period [10] Alternatives - Other ETFs in the same space include Schwab U.S. Dividend Equity ETF (SCHD) and Vanguard Value ETF (VTV), with SCHD having $70.45 billion in assets and VTV at $140.9 billion [12] - SCHD has a lower expense ratio of 0.06%, while VTV charges 0.04%, making them potentially attractive alternatives for investors [12]

Core Viewpoint - The Franklin U.S. Low Volatility High Dividend Index ETF (LVHD) is designed to provide broad exposure to the Large Cap Value segment of the US equity market, with a focus on stable income through investments in profitable U.S. companies with high dividend yields and lower volatility [1][7]. Group 1: Fund Overview - LVHD is a passively managed ETF launched on December 28, 2015, and is sponsored by Franklin Templeton Investments [1]. - The fund has accumulated assets exceeding $579.65 million, positioning it as an average-sized ETF in its category [1]. - The ETF has an annual operating expense ratio of 0.27%, which is competitive within its peer group [4]. Group 2: Investment Characteristics - Large cap companies, typically with market capitalizations above $10 billion, are considered stable investments with lower risk and more reliable cash flows compared to mid and small cap companies [2]. - Value stocks, characterized by lower price-to-earnings and price-to-book ratios, have historically outperformed growth stocks in most markets, although growth stocks tend to perform better in strong bull markets [3]. Group 3: Sector Exposure and Holdings - The ETF has a significant allocation to the Consumer Staples sector, comprising approximately 24.40% of the portfolio, followed by Utilities and Real Estate [5]. - Cisco Systems Inc (CSCO) is the largest individual holding at about 2.65% of total assets, with Chevron Corp (CVX) and Medtronic Plc (MDT) also among the top holdings [6]. - The top 10 holdings collectively account for around 25.11% of total assets under management [6]. Group 4: Performance Metrics - LVHD aims to match the performance of the QS Low Volatility High Dividend Index, which focuses on stable income through investments in high dividend yield stocks with lower volatility [7]. - The ETF has recorded a gain of approximately 7.90% year-to-date and an increase of about 12.48% over the past year as of July 28, 2025 [7]. - Over the past 52 weeks, LVHD has traded within a range of $37.37 to $41.26 [7]. Group 5: Risk and Diversification - The ETF has a beta of 0.66 and a standard deviation of 13.37% over the trailing three-year period, indicating lower volatility compared to the broader market [8]. - With around 122 holdings, LVHD effectively diversifies company-specific risk [8]. Group 6: Alternatives and Market Position - LVHD carries a Zacks ETF Rank of 3 (Hold), indicating a stable position based on expected asset class return, expense ratio, and momentum [9]. - Other comparable ETFs include the Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV), which have significantly larger asset bases of $71.33 billion and $141.62 billion, respectively [10].