The First Trust SMID Cap Rising Dividend Achievers ETF (SDVY) presents a strategic approach for investors interested in the Style Box – Mid Cap Value segment of the market. Launched in November 2017, this smart beta exchange-traded fund (ETF) utilizes a NASDAQ US Small Mid Cap Rising Dividend Achievers Index to achieve its investment objectives, offering a method for potentially outperforming traditional market-cap weighted approaches. Smart beta ETFs, distinguished by their non-cap weighted strategies, represent an alternative to conventional investment methodologies, allowing investors to target specific characteristics they believe will deliver superior risk-adjusted returns. This fund specifically applies methodologies like equal-weighting, fundamental weighting, and volatility/momentum based weighting to identify and hold companies with an established history of increasing dividends and future potential for continued dividend growth.
With assets exceeding $8.92 billion, SDVY has become one of the larger ETFs within this particular investment category. The fund’s core goal is to mirror the performance of the NASDAQ US Small Mid Cap Rising Dividend Achievers Index, taking into account fees and expenses. This index is comprised of the securities of 100 small and mid-cap companies that have consistently raised their dividends and demonstrate a continued capacity for future dividend increases. Investors seeking exposure to this segment of the market often benefit from the diversification offered by this ETF, minimizing the risks associated with investing in individual stocks.
A key consideration for any ETF investment is expense ratios, as these ongoing costs can significantly impact long-term returns. SDVY’s annual operating expenses stand at 0.59%, positioning it as one of the more expensive offerings within the Style Box – Mid Cap Value segment. Despite this, the fund’s performance and strategic approach warrant examination. As of October 16, 2025, SDVY has demonstrated positive returns, adding approximately 6.04% for the year and 3.68% over the past one year. The fund’s trading range over the past 52 weeks has been between $29.52 and $40.33, reflecting market volatility in this segment. The ETF possesses a beta of 1.12, indicating it is more volatile than the overall market, and a standard deviation of 20.66% for the trailing three-year period, further highlighting its risk profile. With a portfolio of around 185 holdings, SDVY effectively spreads company-specific risk, furthering the diversification benefits.
The fund’s holdings are notably concentrated in the Financials sector, accounting for roughly 31.3% of the portfolio. Industrials and Consumer Discretionary round out the top three sectors. Within this allocation, Comfort Systems Usa, Inc. (FIX) represents approximately 1.35% of total assets, while Interdigital, Inc. (IDCC) and Clear Secure, Inc. (class A) (YOU) also hold significant positions. The top 10 holdings collectively account for roughly 11.13% of SDVY’s assets under management, illustrating the influence of its key holdings on overall performance.
Investors considering SDVY should compare it to other viable options within the Style Box – Mid Cap Value segment. The iShares Russell Mid-Cap Value ETF (IWS) tracks the Russell MidCap Value Index and has $14.02 billion in assets, with an expense ratio of 0.23%. The Vanguard Mid-Cap Value ETF (VOE) tracks the CRSP U.S. Mid Cap Value Index and boasts $19.09 billion in assets, along with a low expense ratio of 0.07%. For investors prioritizing cost-effectiveness and lower risk, traditional market-cap weighted ETFs aiming to match the Style Box – Mid Cap Value segment might offer an alternative.
Ultimately, a thorough understanding of one’s investment objectives and risk tolerance is crucial when evaluating SDVY. Resources like the Zacks ETF Center provide valuable tools for screening and researching ETFs, and staying informed about the latest developments in the rapidly evolving ETF investment universe is highly recommended. Continuous monitoring of the fund’s performance and the broader market conditions will contribute to informed investment decisions.
