1 Brilliant Dividend ETF to Build Long-Term Passive Income
2026-07-23 12:30
•Justin Pope •The Motley Fool
•••••• ••••••••••••• Axe Capital view
Is a US Dividend ETF Right for Your Rand Portfolio?
Fidelity’s High Dividend ETF offers steady income and growth but may have limited local appeal for JSE investors.
FDVV’s mix of high-yield blue chips and growth tech giants has delivered an impressive 13.3% annualized return since 2016 with a decent 2.6% yield. For a global-minded investor, that’s solid, especially combined with a tiny 0.15% fee. But here’s the rub for South African investors: direct exposure to this US-dollar denominated ETF means your returns are tied closely to USD/ZAR swings. The rand’s volatility can either erode or enhance the income stream unpredictably. Closer to home, large JSE names like Naspers and Prosus offer tech exposure with local currency convenience but with different risk and valuation profiles. If you want yield combined with growth in rand terms, it might be better to pick select JSE dividend payers like Standard Bank or MTN, which offer high dividends and less currency guesswork. FDVV is appealing for the diversification it provides, but it shouldn’t be a default for SA passive income without considering currency risk. this is just my opinion and not financial advice
Watch FDVV as a portfolio diversifier, but favor high-quality JSE dividend stocks like Standard Bank or MTN for sustainable rand income. Avoid overexposure to USD/ZAR currency moves through dollar-only ETFs.
- FDVV
- USD/ZAR
- Standard Bank
- MTN
- Rand depreciation hitting rand income returns
- US tech valuations correcting sharply
6/10
The Fidelity High Dividend ETF (FDVV) is highlighted as an excellent choice for building passive income, offering a 2.6% dividend yield and 13.3% annualized returns since 2016. The fund combines high-yield blue-chip stocks like Coca-Cola and Procter & Gamble with growth-oriented megacap tech holdings, while maintaining a low 0.15% expense ratio and affordable $62 share price.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Justin Pope
Categories: Rates, Equities, Capital Returns, Technology, AI, Semiconductors
Tickers: FDVV, NVDA, AAPL, MSFT, KO, PG, HD, PM, AVGO, GOOG, GOOGL, GOOGM, GOOGN
Sentiment: Positive - Praised for strong 13.3% annualized returns, above-average 2.6% dividend yield, low expense ratio of 0.15%, and well-balanced portfolio mixing dividend stocks with growth tech holdings. Highlighted as the largest holding in FDVV, representing the growth component of the fund's strategy.
Keywords: dividend ETF, passive income, high dividend yield, technology sector, blue chip stocks, long-term investing
Insights:
- FDVV: Positive: Praised for strong 13.3% annualized returns, above-average 2.6% dividend yield, low expense ratio of 0.15%, and well-balanced portfolio mixing dividend stocks with growth tech holdings.
- NVDA: Positive: Highlighted as the largest holding in FDVV, representing the growth component of the fund's strategy.
- AAPL: Positive: Listed as a top 10 holding in FDVV, contributing to the fund's growth element.