FDVV ETF: $57.09 Dividend Grower Riding AI And Big-Cap Cash Flows

NYSEARCA:FDVV – Fidelity High Dividend ETF In An AI-Driven Dividend Strategy

Fidelity High Dividend ETF (NYSEARCA:FDVV) trades around $57.09 with an annual dividend of about $1.64 per share and a 2.88–3.0% yield, backed by roughly $7.94B in assets and a 0.15% expense ratio. The structure is built to combine large-cap dividend growth with direct exposure to AI and technology leadership, so FDVV behaves more like a growth-tilted value and income core than a slow, high-yield utility fund. At this price and yield level FDVV is positioned as a core dividend-growth holding rather than a short-term trade.

FDVV ETF – Price Level, Yield And Core Proposition

At about $57.09, FDVV ETF offers a 2.88–3.0% trailing yield and an indicated annual payout of roughly $1.64 per share, paid quarterly. Assets under management are close to $7.94B, which is enough scale for tight spreads and deep liquidity. The 0.15% expense ratio keeps costs competitive with serious core ETFs while still allowing a more sophisticated index methodology than the ultra-cheap plain-vanilla trackers. In practice the investor is buying a portfolio designed to deliver mid-single-digit current income plus high-single-digit dividend growth tied to global mega-cap cash flows, rather than a simple high-yield value basket.

FDVV ETF – Portfolio Composition, Holdings And Sector Allocation

The FDVV ETF holds roughly 107 securities, with around 95% allocated to U.S. equities and about 5% to developed international names, almost entirely large and mega caps with strong balance sheets and free-cash-flow generation. Sector allocation is the core differentiator: information technology sits near 26%, financials around 21–22%, and consumer staples approximately 12%, with additional exposure to energy, utilities and real estate that lifts the aggregate yield. The top of the book is dominated by large compounders such as NVIDIA (NVDA) at around 6.2%, followed by Apple (AAPL), Microsoft (MSFT), Broadcom (AVGO), JPMorgan (JPM) and Visa (V), while yield support comes from staples, financials, energy and REITs deeper down the list. The result is a portfolio that sits between classic high-dividend value and growth, giving FDVV structural upside from AI and digitization without abandoning dividend discipline.

FDVV ETF – Index Methodology, Rebalancing And High-Dividend Design

The fund tracks the Fidelity High Dividend Index and must keep at least 80% of assets in index constituents, with the ability to allocate up to about 10% into large and mid-cap non-U.S. names. The methodology explicitly targets high-yield sectors by maintaining roughly 40% of the index in the highest-yielding sectors, which is how FDVV sustains a starting yield near 3% while holding technology leaders. Rebalances and reconstitutions are executed annually, aligned with index updates but not on a rigid quarterly schedule, giving the design room to remove deteriorating names and increase weight in companies with improving dividend capacity and capital appreciation potential. Unlike rigid “aristocrat” rules that lock funds into decades-old payers, FDVV focuses on expected future dividend durability and growth, not backward-looking streak length.

FDVV ETF – Sector Profile Versus S&P 500 And Risk Tilts

Compared with a broad benchmark such as SPY, FDVV ETF makes deliberate sector bets. Technology is slightly lower than the S&P 500 at roughly 26% versus 34–35% for SPY, but for a high-dividend fund that tech weight is still unusually high. Financials are heavier, around 20% versus about 13% in SPY, while consumer defensive, energy, utilities and real estate all carry significantly larger weights in FDVV than in the S&P 500. This mix is precisely where the incremental yield is created, by leaning into cash-generative, higher-payout sectors while keeping enough tech to capture structural growth. The trade-off is clear: more sector concentration risk than a pure S&P 500 tracker, but a better combination of income and growth than a traditional value-only ETF.

FDVV ETF – Performance Track Record Against SCHD, VIG And Peers

Across multi-year periods FDVV ETF has sat near the top of the dividend and value cohort for total return. Over the last several years it has outperformed major dividend peers like SCHD, VYM, SDY and DGRO, and competes directly with VIG on total return while offering a higher starting yield. A backtest from early 2017 shows FDVV delivering a standard deviation around 13.1% compared with about 15.2% for SPY, and a “worst year” near –4.2% including dividends versus roughly –18.2% for the S&P 500 tracker. Over the most recent 12-month window in your data, FDVV’s price return of about 10–11% and total return near 14–15% demonstrate that the ETF is behaving as intended: less volatile than the index, but able to keep up with or beat the main dividend competitors that have avoided AI-heavy tech.

FDVV ETF – Dividend Yield, Growth Rates And Tax Efficiency

The trailing FDVV ETF yield is about 2.9–3.0%, with a trailing dividend rate around $1.64 per share and quarterly payouts. The headline number looks modest versus some high-yield products, but the key is dividend growth. Over the latest data window the 5-year dividend CAGR is roughly 9.8–10.4%, the 3-year CAGR sits near 8.4–9.7%, and the trailing twelve-month growth rate is above 11%, which puts FDVV at the top of the high-dividend ETF universe. A simple backtest from 2016, assuming a $10,000 initial investment with all dividends reinvested, shows annual income rising from around $404 in 2016 to roughly $800 in 2025, effectively doubling the cash flow without adding capital. That equates to a yield-on-cost near 5.4–5.5% after five years and above 6.8% after a decade. The bulk of the distributions qualify as QDI, so for a 22% marginal tax rate a 2.9% QDI yield is broadly comparable to about 3.7% in fully taxable interest, making FDVV increasingly attractive as money-market yields fall.

FDVV ETF – Relative Positioning Versus SCHD, VYM, DGRO And VIG

Relative to other dividend ETFs, FDVV ETF sits deliberately in the middle of the spectrum. SCHD offers a higher current yield near 3.8% and an ultra-low 0.06% fee, but is more heavily weighted to energy and consumer staples and underweight technology, which explains the recent underperformance versus the S&P 500 despite a strong income record. VYM, HDV and DVY run more traditional value and high-yield exposures with larger stakes in slow-growth cyclicals and utilities and lower participation in AI and cloud leaders, which has translated into weaker long-run total returns in the data you provided. VIG and DGRO provide high-quality dividend-growth exposure with lower yields, with VIG around 1.6%, and stricter inclusion rules that limit exposure to newer tech winners. FDVV’s design gives a yield higher than VIG and DGRO, slightly below SCHD and VYM, with dividend-growth metrics that match or exceed all three and with much stronger structural exposure to technology and AI. Overlap with SCHD is only about 15%, so using both together is additive, not redundant.

FDVV ETF – AI, Technology Exposure And Long-Term Growth Drivers

The most important structural feature of FDVV ETF going into the next cycle is the direct participation in AI, semiconductors and cloud infrastructure combined with a real dividend. With NVIDIA (NVDA) near 6.2% of assets, and additional weight in Apple, Microsoft, Broadcom, Visa and JPMorgan, the fund is positioned to monetize data-center AI CAPEX, software and payments volume, and financial sector digitization while still paying roughly a 3% yield. AI market projections in your sources show sector growth around 19% CAGR through 2034, and FDVV captures that through profitable incumbents instead of speculative micro-caps. This reduces blow-up risk compared with niche AI funds while preserving a powerful secular growth engine under the dividend stream.