Proshares ETF S&P500 dividend Aristocrats (NOBL) - 04/08/2017
Short term strategy : Positive (60%) / Trend =
Long term strategy : Positive (95%) / Trend =
Characteristics of the ETF
The NOBL (Proshares) tracker replicates the performance of the S & P 500 Dividend Aristocrats Index, comprised of S & P 500 companies that have increased or maintained their dividend over a period of at least 25 years.
This index includes 51 companies, which are equally weighted. It also includes a constraint on sectors, as a single sector may not account for more than 30% of the portfolio. The main sectors represented are basic consumption (26%), industry (18%), health (15%) and discretionary consumption (11%). There are some flagship stocks such as Johnson & Johnson, ATT, Chevron, 3M, Procter & Gamble, as well as somewhat lesser-known companies with similar characteristics.
This ETF has several interests: it is invested in one of the most dynamic markets in the world, the USA, it integrates by nature companies with solid and recurring results and it is invested in many sectors. It is therefore an excellent support in the context of a long-term strategy. Another advantage of this ETF is its low historical volatility compared to the benchmark index (S & P500). NOBL generally performs well during periods of market consolidation and in this case benefits from what is called “flight to quality” because in a context of more uncertain growth, the regularity of the dividends is perceived as an asset.
In 2016 NOBL grew by 9.3%, and by 8.3% since the beginning of 2017. Following a sharp rise in US indices in the wake of the US election and an already mature economic cycle in USA, this ETF seems to us a must have vehicle in a context that becomes more tense at the geopolitical level and from a valuation perspective.
The fees for this ETF are moderate, at 0.35% for a high outstanding amount of $ 2,640 million.
We have integrated NOBL into our Active Dollar portfolio on 20/05/2016 in a long-term perspective, given its quality bias. This ETF has gained almost 12% since then, which is a slower growth than the S & P500 (+ 20%) but also more regular and less volatile. While US markets are breaking historic records, boosted by a dollar weakened by the loss of credibility of the current US administration and the persistently low interest rate outlook strengthened by the Fed statements, NOBL has the advantage of quality that can better justify a demanding valuation, which is not the case for all sectors.
In the event of a correction, we expect NOBL to outperform the market
Monthly data
Long-term charts bear witness to both the direction of the trend, a structurally upward trend, but also the low volatility that accompanies it. Corrections that regularly shake the markets are on average better absorbed by this ETF and the corrective episodes are rather rare. Another positive is that NOBL's displayed regularity does not result in any overbought situation especially as oscillators are concerned, a positive factor which consequently reduces the need for correction.
Weekly data
The weekly chart shows a very bullish index whose trend is supported by the EMA100 on which the prices come back from time to time, as a return to the mean, during the corrective episodes. This EMA100 is currently in the $ 54 range, only 7 to 8% below current prices ($ 58), which shows a fairly limited correction potential.
The MACD evolves flat, so the current negative crossover has to be appreciated accordingly, although it should not be neglected.
ETF Objective
NOBL is an ETF which replicates the performance of the S&P500 Dividend Arsitocrat Index.
Characteristics
Inception date | 10/09/2013 |
Expenses | 0,35% |
Benchmark | S&P500 Dividend Aristocrat |
Code/Ticker | NOBL |
Issuer | ProShares |
ISIN | US74348A4673 |
CUSIP | 74348A467 |
Currency | Dollar |
Exchange | NYSE |
Assets Under Management | 2 640 M$ |
Dividend | Distribution |
PEA | No |
SRD | No |
Currency Risk | No |
Number of Holdings | 51 |
Risk | 3/5 |
Country Breakdown
USA | 100% |
Sector Breakdown
Consumer Staples | 26% |
Industrials | 17% |
Health Care | 13% |
Consumer Discretionary | 12% |
Financials | 10% |
Materials | 10% |
Energy | 4% |
Autres | 10% |
Top Ten Holdings
ADP Inc | 2% |
VF Corp | 2% |
Cincinnati Financials | 2% |
Chevron Corp | 2% |
AT&T | 2% |
Target Corp | 2% |
WAL-MART Stores | 2% |
Lowe's cos Inc | 2% |
Aflac Inc | 2% |
Procter & Gamble | 2% |