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Diversification by Equal-Weight Dividend index.


For the Canadian dividend income oriented investor, the (only) choice has been iShares XDV. But it has a 60% weighting to financials.

Does Claymore Investments Equal weight Banc & LifCo ETF (CEW) add diversification value?

It doesn’t. It’s too narrow (100% in 10 financial holdings), has higher cost and lower volume (and smaller dividend yield).

iShares.ca Dow Jones Canada Dividend index ETF(XDV)   MER 0.55% ClaymoreInvestments.ca, Equal Weight Banc & LifeCo. (CEW) MER 0.58%
CIBC 6.58% MANULIFE FINANCIAL 12.64 %
BONTERRA ENERGY 5.85% INDUSTRIAL ALLIANCE 10.76 %
BANK OF MONTREAL 5.16% SUN LIFE FINANCIAL 10.15 %
TD BANK 4.88% NATIONAL BANK 9.90 %
AG GROWTH INT’L 4.82% TD BANK 9.81 %
NATIONAL BANK 4.80% BANK OF NOVA SCOTIA 9.72 %
TELUS CORP. 4.26% GREAT WEST LIFE 9.30 %
ROYAL BANK 3.92% BANK OF MONTREAL 9.27 %
IGM FINANCIAL INC. 3.91% ROYAL BANK 9.24 %
BANK OF NOVA SCOTIA 3.81% CIBC 9.22 %

Next time?

More Dividend index ETF diversification.

Doug Cronk, CFA is Manager, Investments for a Canadian Pension fund.

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