Japan ETFs Top Dividend Fund Rankings for September

Energy outperformed as oil prices rose, while REITs lagged.

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Reviewed by: etf.com Staff
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Edited by: etf.com Staff

Small-cap Japanese funds grabbed the first and second spots on the list of best-performing dividend ETFs, while a real estate investment trust dividend fund was the worst performer. 

The best-performing dividend exchange-traded fund was the WisdomTree Japan Hedged SmallCap Equity Fund (DXJS), which returned 4%, and the worst performer was the ALPS REIT Dividend Dogs ETF (RDOG), which lost 5.8%. etf.com ranked the funds by one-month trailing total returns as of Sept 29, 2023. Inverse funds, leveraged funds and funds not traded in the U.S. were excluded. 

Over the same period, the broader U.S. stock market, as represented by the SPDR S&P 500 ETF Trust (SPY) lost 3.5%, while the largest dividend ETF, the Vanguard Dividend Appreciation ETF (VIG), lost 4.2%. 

Sector and country performance were dominant factors for dividend funds in September. While U.S. stocks sagged, Japanese markets, as measured by the benchmark iShares MSCI Japan ETF (EWJ), fell only 0.3%. As REITs underperformed even the sagging U.S. stock market, the energy sector was a bright spot. 

“In September, energy outperformed due to the rally in oil, which hit a 13-month high,” said Sumit Roy, senior analyst at etf.com. 

Best-Performing Dividend ETFs

 Name 1-Month Total Return Assets Under Management ($M) Expense Ratio
DXJS  WisdomTree Japan Hedged SmallCap Equity Fund4.0%530.58%
DFJWisdomTree Japan SmallCap Dividend Fund1.9%2040.58%
AMNDETRACS Alerian Midstream Energy Dividend Index ETN1.2%390.75%


Worst-Performing Dividend ETFs

Ticker                             Name 1-Month Total Return Assets Under Management ($M) Expense Ratio
RDOGALPS REIT Dividend Dogs ETF-5.8%120.35%
TMDVProShares Russell U.S. Dividend Growers ETF-5.4%100.35%
EUDVProShares MSCI Europe Dividend Growers ETF-5.0%80.55%


Japan ETFs in the Lead 

After many years of sagging growth, Japan has surged forward over the past year. Its economy grew by 6% on an annualized basis in the second quarter, the most recent one there is data for. That was double what analysts had expected, according to the New York Times.  

EWJ returned 23% versus SPY’s 21% on a one-year trailing basis as of the end of September. That’s compared with the roughly 40-point gap in performance over a five-year trailing period. 

Energy ETFs Rise, REIT ETFs Lag 

Dividend funds were broadly underperformers in September, as interest rates continued to rise throughout the month. According to Roy, when rates rise, the yields of dividend stocks become comparably less attractive.  

The REIT sector, as measured by the Real Estate Select Sector SPDR Fund (XLRE) underperformed the broader market, having dropped 9% over the month, while the Energy Select Sector SPDR Fund (XLE) gained 0.5%.   
 

Contact Gabe Alpert at [email protected]

Gabe Alpert is a former data reporter at etf.com with over seven years’ experience in financial journalism. He also previously contributed reporting and analysis to Barron’s Magazine, Investopedia and other publications.