The VictoryShares International Value Momentum ETF (UIVM) presents a compelling investment option for those looking to diversify their portfolios internationally while also generating income through monthly dividends. This ETF has shown remarkable strength, outperforming the S&P 500 and other major international funds over both one-year and three-year periods. Its success is attributed to robust net asset value growth and a strategic focus on value and momentum factors. Additionally, UIVM offers a competitive expense ratio and a reasonable price-to-earnings ratio, positioning it favorably against its counterparts. Although it has faced some challenges over a longer five-year period and carries inherent market risks, UIVM remains a strong buy for investors who prioritize high yield, global diversification, and the potential for long-term growth in international markets.
The U.S. economic landscape, despite some indicators of weakening, such as the August jobs report, has seen the S&P 500 continue its ascent to new highs, leading to a scarcity of undervalued assets. This market condition underscores the importance of looking beyond domestic borders for investment opportunities. It's in this context that the VictoryShares International Value Momentum ETF (UIVM) emerges as a particularly attractive option.
UIVM is designed to capture the performance of non-U.S. developed market equities that exhibit strong value and momentum characteristics. By combining these two fundamental investment factors, the ETF aims to identify companies that are not only trading below their intrinsic value but also demonstrating positive price trends. This dual-factor approach can potentially lead to more resilient returns and mitigate some of the risks associated with investing in a single factor.
One of the most appealing features of UIVM for income-focused investors and retirees is its monthly dividend payout and a yield approaching 4%. This consistent income stream can be highly beneficial for those relying on their investments for regular cash flow. Furthermore, international diversification is a critical component of a well-rounded portfolio, helping to reduce overall risk by spreading investments across different economies and market cycles. UIVM provides this exposure to non-U.S. markets, which can act as a counterbalance to domestic market fluctuations.
Performance-wise, UIVM has delivered impressive results, surpassing both the S&P 500 and its direct international peers over the past one and three years. This outperformance highlights the effectiveness of its underlying strategy and its ability to navigate diverse market conditions. The ETF's net asset value growth has been a key driver of these returns, indicating strong asset selection and management. When evaluating its valuation, UIVM's price-to-earnings ratio of 13.96x positions it as a value-oriented choice compared to the broader S&P market and many other global funds. While some competing ETFs may offer slightly lower expense ratios, UIVM's 0.35% is still highly competitive, ensuring that a significant portion of returns is retained by investors.
In summary, the VictoryShares International Value Momentum ETF offers a compelling blend of international diversification, attractive yield, and a proven track record of outperformance in recent years. Its strategic focus on value and momentum factors, combined with a reasonable expense ratio, makes it an excellent candidate for investors seeking to enhance their portfolios with non-U.S. exposure and a steady income stream. Despite historical underperformance over a five-year period, its current positioning and characteristics make it a noteworthy investment for long-term growth and income generation.