HDLV ETF — Holdings & Analysis

For informational purposes only. Not financial advice.

Quick Answer

The UBS ETRACS Monthly Pay 2xLeveraged US High Dividend Low Volatility ETN (HDLV) is an equity-focused exchange-traded note with $0.02 billion in assets under management.

It seeks to provide a monthly compounded two times leveraged long exposure to the Solactive US High Dividend Low Volatility Index. With an expense ratio of 0.85%, HDLV offers a leveraged approach to high-dividend, low-volatility U.S. stocks, targeting investors seeking enhanced returns, but also increased risk, from this specific market segment. Past performance does not guarantee future results.

UBS ETRACS Monthly Pay 2xLeveraged US High Dividend Low Volatility ETN (HDLV) ETF — Price, Holdings & Analysis

The UBS ETRACS Monthly Pay 2xLeveraged US High Dividend Low Volatility ETN (HDLV) is an equity-focused exchange-traded note with $0.02 billion in assets under management. It seeks to provide a monthly compounded two times leveraged long exposure to the Solactive US High Dividend Low Volatility Index. With an expense ratio of 0.85%, HDLV offers a leveraged approach to high-dividend, low-volatility U.S. stocks, targeting investors seeking enhanced returns, but also increased risk, from this specific market segment. Past performance does not guarantee future results.

ETF Overview

The investment seeks a return linked to the performance of the price return version of the Solactive US High Dividend Low Volatility Index (the âindexâ). The Securities provide a monthly compounded two times leveraged long exposure to the performance of the index, reduced by the Accrued Fees. The index is designed to measure the performance of 40 dividend yielding, relatively lower volatility index constituent Securities from the universe of the largest 1,000 U.S. listed stocks by market capitalization.

HDLV aims to deliver twice the monthly performance of the Solactive US High Dividend Low Volatility Index, which comprises 40 dividend-paying U.S. stocks exhibiting relatively lower volatility. This ETN employs a 2x leveraged strategy, meaning it seeks to amplify the index's returns (and losses). The index selects its constituents from the largest 1,000 U.S.-listed companies by market capitalization, focusing on those with high dividend yields and lower volatility characteristics. As an ETN, HDLV's returns are linked to the index's performance, but it also carries the credit risk of the issuer, UBS. This product is designed for sophisticated investors who understand the risks associated with leveraged investments and are seeking potentially higher returns from a portfolio of high-dividend, low-volatility stocks. Investors should carefully consider the impact of compounding and potential for magnified losses in volatile markets. Past performance does not guarantee future results.

Risk Metrics

HDLV's leveraged nature significantly amplifies both potential gains and losses, making it a higher-risk investment compared to non-leveraged equity ETFs. Its 3-year beta of 1.34 indicates that it is more volatile than the overall market. The 0.85% expense ratio is relatively high, which can create a drag on performance, especially in periods of low returns. As an ETN, HDLV also carries credit risk, as its value is dependent on UBS's ability to meet its obligations. Investors should also be aware of concentration risk, as the fund invests in a limited number of 40 stocks. The focus on high-dividend, low-volatility stocks may lead to sector concentration, depending on which sectors meet those criteria at any given time. Past performance does not guarantee future results.

Expense Ratio

0.85%

Dividend Yield

14.16%

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Risk Metrics

Beta: 1.34

Questions & Answers

What is HDLV and what does it track?

HDLV is the UBS ETRACS Monthly Pay 2xLeveraged US High Dividend Low Volatility ETN. It is designed to provide a monthly compounded two times leveraged long exposure to the Solactive US High Dividend Low Volatility Index.

The index itself tracks the performance of 40 dividend-paying, relatively lower volatility stocks selected from the largest 1,000 U.S.-listed companies by market capitalization.

What is the expense ratio for HDLV?

The expense ratio for HDLV is 0.85%. This means that for every $10,000 invested, $85 is deducted annually to cover the fund's operating expenses. This is higher than the average expense ratio for equity ETFs, which is around 0.44%.

The expense ratio as it can impact the overall returns of the investment, especially over the long term may be worth researching.

What are the top holdings in HDLV?

As a leveraged ETN tracking an index, HDLV does not directly hold stocks. Instead, its value is linked to the performance of the Solactive US High Dividend Low Volatility Index.

The index's top holdings will vary over time based on the index methodology. Investors can consult the Solactive index factsheet for the most up-to-date list of the index's top constituents. The index is designed to hold 40 stocks.

Is HDLV a good long-term investment?

HDLV's leveraged nature makes it a potentially risky investment, especially for the long term. While the 2x leverage can amplify returns in a rising market, it can also magnify losses in a declining market.

The 0.85% expense ratio can also erode returns over time. Investors should carefully consider their risk tolerance and investment objectives before investing in HDLV. Past performance does not guarantee future results.

How does HDLV compare to similar ETFs?

HDLV differentiates itself through its leveraged exposure to high-dividend, low-volatility stocks. Many dividend ETFs offer unleveraged exposure, typically with lower expense ratios. HDLV's 0.85% expense ratio is higher than many unleveraged dividend ETFs.

With AUM of $0.02 billion, HDLV is relatively small compared to some of the larger dividend ETFs.

Does HDLV pay dividends?

HDLV is designed to provide monthly payments linked to the dividends of the stocks within the Solactive US High Dividend Low Volatility Index. The current dividend yield for HDLV is 14.16%.

However, it's important to note that this yield can fluctuate based on the performance of the underlying index and the dividends paid by the constituent companies. The actual payments are subject to the ETN's fee structure.

Disclaimer: This content is for informational purposes only and does not constitute investment advice. Always do your own research and consult a financial advisor.

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