XTrackers Euro Stoxx Quality Dividend UCITS ETF 1D

Issuer: Xtrackers

Asset Class: Equity

TER: 30bps

Trading Currency: GBX

Pays Income: False

Listing Date: 07 Sep 2007

Ticker: XD3E

ISIN: LU0292095535

This fund provides targeted exposure to 50 high-quality, dividend-paying companies from the Eurozone, selected from the broader EURO STOXX index universe. The investment strategy is systematically driven, aiming to identify established firms that not only offer attractive dividend yields but also exhibit strong financial health and operational stability. It achieves this by employing a dual-screening methodology that first isolates companies based on specific quality metrics before selecting the highest dividend payers from that filtered group. This approach provides a more nuanced exposure to the European market than traditional market-cap-weighted strategies.

The underlying index's selection process focuses on key quality indicators such as high return-on-equity, low financial leverage, and stable earnings growth. After identifying this cohort of fundamentally sound businesses, the index selects the 50 stocks with the highest dividend yields. This combination of quality and dividend factors is designed to capture the potential for long-term capital appreciation associated with quality companies, while also providing a consistent income stream. The strategy inherently screens out companies whose high dividend yields might be unsustainable or indicative of underlying business weakness, often referred to as 'value traps'.

This product is well-suited for investors seeking a core European equity holding with a potential for both income and growth. Its factor-based approach may appeal to those looking for a more defensive posture within their equity allocation, as quality companies have historically demonstrated greater resilience during periods of economic stress. By focusing on financially robust, dividend-paying firms, the fund offers a strategic tilt towards stability and shareholder returns, making it a compelling option for building a diversified, long-term portfolio with a European focus.