"The Global X SuperDividend ETF ( NYSEARCA:SDIV) generates its 8% yield by investing in 100 of the highest dividend-yielding equities across global markets. The fund holds stocks from developed and emerging markets spanning telecommunications, energy, materials, financials, and real estate. Income comes directly from dividends paid by underlying companies, making SDIV's distributions entirely dependent on whether holdings can maintain their payouts."
"British American Tobacco is the biggest red flag here, with a 170% payout ratio, meaning they pay out more in dividends than they earn.. While the company maintains a 42% operating margin, revenues declined 2.2% year-over-year and earnings growth sits at just 1.6%. The secular decline in traditional tobacco creates structural pressure on maintaining current distributions. AT&T demonstrates genuine dividend safety. Following its 2022 restructuring, the telecom maintains a conservative 36% payout ratio with 26.3% earnings growth and a 19.1% return on equity."
The Global X SuperDividend ETF (NYSEARCA:SDIV) generates an 8% yield by investing in 100 of the highest dividend-yielding equities across developed and emerging markets. The fund holds telecommunications, energy, materials, financials, and real estate stocks and pays income from dividends of underlying companies. SDIV charges a 0.58% expense ratio and manages about $1.1 billion, with no single holding exceeding 2% but with substantial exposure to higher-risk markets and industries. Dividend sustainability depends on top positions: some firms show unsustainably high payout ratios while others display conservative metrics. High portfolio turnover (93%) increases distribution volatility and cut risk.
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