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[TOP STORY] The CoreShares S&P ETF that’s free of tech

Simon Brown: I’m chatting now with Chris Rule from CoreShares. Chris, I appreciate the morning hours. Your CoreShares S&P Global Dividend Aristocrats ETF: We were chatting on Friday and you pointed out to me that because of its approach, which has a long track record of paying dividends, if memory serves, for US companies — I think it’s 25 years — that means it’s technology. free And looking at that chart, it’s certainly tech free, because it’s under pressure, but not something we’ve seen in the Nasdaq; And honestly not as much as we’ve seen in the S&P 500.

Chris rules: Yes, one hundred percent correct. Method of dividend [in] Elites have been around for a while now, but [for] Companies in the US to qualify – you said 25 – it’s actually 50 years.

Simon Brown: Whoah.

Chris rules: Yes. So it varies from region to region, but they’re really the kind of companies that have proven their track record with cash flow and dividend payments. So when you look at the make-up of the sector, say, earlier this year, technology was sitting at about 5% of the strategy, and on the other hand something like consumer major was closer to 20%. And that’s almost an exact opposite of what you see in, say, MSCI World or MSCI ACWI. So the exposure looks very different. And then because of some of the pressures around the market and interest rate pressures and inflationary pressures, the behavior was very different, of course, in the strategy you name in relation to some of those names — the Nasdaq and the S&P 500 and so on.

Simon Brown: It actually made me think about it then – I looked at it and thought, hey, this is a nice non-tech. It’s not an untrue statement but, especially considering most investors, we’ll be in the MSCI World, or we’ll be in the S&P 500, or your global, [where the code is ‘global]. They all serve a purpose, they’re all a bit tech-heavy. It’s almost a nice contrast to have in the portfolio, as it’s significantly less volatile. It’s going to be a little more boring, but there’s a place for some boring in equity portfolios.

Chris rules: absolutely

Before we launched the fund, we did a lot of work, particularly in the stock-broking market for private clients, and it suggested that clients, when they took their money out and invested offshore, were actually looking for safe haven investments.

So, as you say, boring companies, the kind of companies you recognize, that have been around for a long time – Unilever and Procter & Gamble, Coca-Cola and Pepsi. Such companies are actually looking to invest as they nest egg.

A major reason for clients to invest offshore was to diversify their exposure and ultimately protect the longevity of their assets.

And so we’re just like that in this position. It’s a portfolio diversifier, a portfolio of high-quality stocks that have proven their business models over time, basically.

Simon Brown: Yes. And paying 50 years of dividends – this does not come lightly at all. And it’s stocks, it’s IBM, it’s Colgate Palmolive, it’s, like you say, Procter & Gamble. Even if times are tough, we still brush our teeth.

We’ll leave it at that. Chris Rule at CoreShares As always I appreciate the morning insight.

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