The Proshares NOBL ETF created in 09/2013 USD-denominated on the NYSE and replicates the S & P 500 Dividend Aristocrats index, composed of 53 equal-weighted stocks and which have increased or maintained their dividends over the past 25 years.
The fee for this ETF is 0.35% and the AUM is approximately $ 3540M. The replication method is direct and there is a quarterly dividend distribution method.
Alternative ETF: WDIV (SPDR in USD)
Latest developments
The NOBL ETF rose by 18.8% in 2017, which corresponds roughly to the performance of the S & P500 and is down 1.33% in 2018 (against + 3.3% for the S & P500), while the technology stocks remain the main growth driver for US indices.
However, the major US qualitative values represent an interesting diversification at a time when fears of a trade war between the US and its main partners, China in the lead, are feared a decline in global growth and potentially a new crisis in emerging countries, which are under heavy pressure because of the simultaneous rise in oil, the USD and 10-year US rates, which may have difficulty absorbing a decline in Chinese growth and restrictions on global trade.
US qualitative values could play a safe haven role if growth stocks are constrained by the trade war that is emerging.
Index & Components
The NOBL (Proshares) tracker replicates the performance of the S & P 500 Dividend Aristocrats Index, composed of S & P 500 companies that have increased or maintained their dividend over a period of at least 25 years.
This index includes 53 values, which are equal-weighted. It also includes a sector constraint, with one sector accounting for a maximum of 30% of the portfolio. Among the main sectors represented are consumer staples (24.4%), industrial sector (20.3%), health sector (11%) and consumer discretionary (12%). There are flagship values such as Johnson & Johnson, ATT, Chevron, 3M, Procter & Gamble, as well as slightly less well-known values that have the same characteristics.
This ETF has many interests: it is invested in one of the most dynamic markets in the world, the USA, by nature it incorporates companies with solid and recurring results and it is invested in many sectors, including a number of growth sectors. It is therefore an excellent support as part of a long-term strategy.
Another asset of this ETF is the lower historical volatility compared to the benchmark (S & P500). NOBL generally behaves quite well during periods of market consolidation and benefits in this case from the so-called "flight to quality" because in a context of more uncertain growth, the regularity of dividends is seen as an asset.
After a sharp rise in US indices, in the wake of the US election and an already fairly mature economic cycle in the US, this ETF seems to us a preferred medium in a context that becomes more tense at the geopolitical level and from a valuations point of view.
NOBL has the advantage of quality which can better justify a demanding valuation (currently 20x results at 12 months) which cannot be applicable to all sectors. In the event of a correction, we expect NOBL to outperform the market.
