4 min readBy Beqa Bumbeishvili ETF Insider
How does the SYLD ETF work?
The SYLD ETF is a specialized investment fund that focuses on a specific sector. This exchange-traded fund offers investors exposure to a range of companies in this sector.
The Cambria Shareholder Yield ETF (SYLD) is actively managed by Cambria Investment Management, L.P. The fund's primary objective is to invest at least 80% of its total assets in equity securities of U.S.-based publicly listed companies that offer high shareholder yield. Cambria defines shareholder yield as the sum of returns generated for investors through a company's cash payments for dividends, share buybacks, and debt reduction. To select its holdings, Cambria employs a quantitative model that identifies the top 20% of stocks from the initial universe of U.S.-based publicly listed companies based on their shareholder yield, measured by dividends and net share buybacks. This selection process aims to construct a portfolio of companies with potential for income and capital appreciation. SYLD may invest in companies of varying market capitalizations and sectors, with a focus on value metrics and shareholder yield characteristics. The fund's holdings are subject to periodic adjustments to meet its investment criteria and target allocations, and it may sell securities when deemed overvalued or when better opportunities arise.
The Cambria Shareholder Yield ETF (SYLD) aims to provide investors with exposure to U.S.-based publicly listed companies that offer high shareholder yield. This yield includes dividends, share buybacks, and debt paydowns. SYLD actively manages its portfolio by selecting the top 20% of stocks with the highest shareholder yield, and then applies additional value metrics to create a well-rounded composite. While the primary focus of SYLD is not on dividends alone, it offers a potential source of income to investors through its constituent companies' dividend policies and other shareholder-friendly practices. SYLD's portfolio may include companies of various market capitalizations and sectors, and its holdings are periodically adjusted to meet the Fund's investment criteria and target allocations based on its quantitative algorithm.
Tracking high shareholder yield companies is the primary focus of the Cambria Shareholder Yield ETF (SYLD). SYLD actively manages its portfolio by investing at least 80% of its assets in equity securities issued by publicly listed U.S.-based companies that offer high shareholder yields. This includes companies that provide returns through dividends, share buybacks, and debt paydowns. Cambria utilizes a quantitative model to identify the top 20% of stocks based on their shareholder yield, incorporating factors like dividend payments, net share buybacks, and debt reduction. Additionally, the ETF considers various value metrics to select the top 100 stocks that combine attractive shareholder yield characteristics with value attributes. While SYLD generally focuses on larger market capitalizations, it may also invest in small- and mid-cap companies, with sector exposure that can change over time. The fund's holdings are periodically adjusted to align with its investment criteria and target allocations.
The correlation aspect of the Cambria Shareholder Yield ETF (SYLD) is integral in understanding its investment behavior. As an actively managed fund, SYLD aims to invest in U.S.-based publicly listed companies that provide high shareholder yield, defined as the totality of returns from dividends, buybacks, and debt paydowns. This unique approach can result in correlations that vary from traditional market-tracking ETFs. SYLD's correlation analysis with various asset classes and sectors can provide valuable insights into its performance and suitability for income-focused investors.
The Cambria Shareholder Yield ETF (SYLD) primarily focuses on investing in U.S.-based publicly listed companies that offer high shareholder yield. Shareholder yield encompasses various returns generated by a company, including dividends, share buybacks, and debt reduction. This actively managed fund employs quantitative models to select stocks with the highest shareholder yield and combines this criterion with value metrics such as price-to-book ratio, price-to-sales ratio, and price-to-earnings ratio. While the portfolio may have a tilt towards larger market capitalizations, it may also include small- and mid-cap companies. As of August 1, 2023, SYLD had significant exposure to sectors like energy, materials, financial services, and consumer discretionary, though this sector allocation may vary over time. The fund aims to provide income and capital appreciation by investing in companies that exhibit strong shareholder yield characteristics and value metrics, but it may adjust its holdings based on market conditions and investment opportunities.
The exposure characteristics of the Cambria Shareholder Yield ETF (SYLD) reflect its active management strategy centered around U.S.-based publicly listed companies that provide high shareholder yield. SYLD''s investment approach is to focus on companies with a strong history of returning value to shareholders through dividends, share buybacks, and debt reduction. It targets companies with a combination of shareholder yield and value metrics, resulting in a diverse portfolio that may include both large-cap and small-cap stocks. As of August 1, 2023, SYLD had significant investment exposure to companies in the energy, materials, financial services, and consumer discretionary sectors, although sector exposure may evolve over time. For a more comprehensive understanding of SYLD''s exposure and portfolio composition, ETF Insider''s web app offers detailed insights, visualizations, and correlations to help investors make informed decisions.
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