Should iShares Core High Dividend ETF (HDV) Be on Your Investing Radar?

Launched on March 29, 2011, the iShares Core High Dividend ETF (HDV) is a passively managed exchange traded fund designed to provide a broad exposure to the Large Cap Value segment of the US equity market.

The fund is sponsored by Blackrock. It has amassed assets over $13.38 billion, making it one of the larger ETFs attempting to match the Large Cap Value segment of the US equity market.

Why Large Cap Value

Large cap companies usually have a market capitalization above $10 billion. They tend to be stable companies with predictable cash flows and are usually less volatile than mid and small cap companies.

Value stocks have lower than average price-to-earnings and price-to-book ratios. They also have lower than average sales and earnings growth rates. Looking at their long-term performance, value stocks have outperformed growth stocks in almost all markets. They are however likely to underperform growth stocks in strong bull markets.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.08%, making it one of the least expensive products in the space.

It has a 12-month trailing dividend yield of 2.88%.

Sector Exposure and Top Holdings

ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Consumer Staples sector -- about 27.3% of the portfolio. Energy and Healthcare round out the top three.

Looking at individual holdings, Exxon Mobil Corp (XOM) accounts for about 10.43% of total assets, followed by Chevron Corp (CVX) and Johnson & Johnson (JNJ).

The top 10 holdings account for about 57.57% of total assets under management.

Performance and Risk

HDV seeks to match the performance of the Morningstar Dividend Yield Focus Index before fees and expenses. The Morningstar Dividend Yield Focus Index offers exposure to high quality U.S. domiciled companies that have had strong financial health and an ability to sustain above average dividend payouts.

The ETF has added about 11.82% so far this year and it's up approximately 17.86% in the last one year (as of 03/09/2026). In the past 52-week period, it has traded between $108.41 and $140.18.

The ETF has a beta of 0.58 and standard deviation of 11.38% for the trailing three-year period, making it a medium risk choice in the space. With about 81 holdings, it effectively diversifies company-specific risk.

Alternatives

iShares Core High Dividend ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, HDV is a good option for those seeking exposure to the Style Box - Large Cap Value area of the market. Investors might also want to consider some other ETF options in the space.

The Schwab U.S. Dividend Equity ETF (SCHD) and the Vanguard Value Index Fund ETF Shares (VTV) track a similar index. While Schwab U.S. Dividend Equity ETF has $84.21 billion in assets, Vanguard Value Index Fund ETF Shares has $167.36 billion. SCHD has an expense ratio of 0.06% and VTV charges 0.03%.

Bottom-Line

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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iShares Core High Dividend ETF (HDV): ETF Research Reports

This article originally published on Zacks Investment Research (zacks.com).

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