DIVI vs HDEF

DIVIAFranklin International Core Dividend Tilt Index ETF

HDEFAXtrackers MSCI EAFE High Dividend Yield Equity ETF

In short

DIVI A tilt, not a screen: DIVI optimizes a broad developed-markets ex-North America index toward higher yield while limiting drift from that parent. Core international shape, income lean, 0.09% a year.

HDEF Its cohort manufactures income with options overlays. HDEF skips the machinery: roughly 120 higher-yielding developed-market stocks, tracked passively, for nine basis points.

Stated mandate

DIVI The Fund seeks to track, before fees and expenses, the Morningstar Developed Markets ex-North America Dividend Enhanced Select Index. Its index methodology seeks higher dividend yield than the parent index while maintaining core exposure to developed markets outside North America.

HDEF The Fund uses a passive indexing approach to track the MSCI EAFE High Dividend Yield Index before fees and expenses.

Why people hold it

• DIVI Costs 0.09% a year, while the median fund in its international-dividend cohort charges closer to 0.50%.
• The index takes a broad developed ex-North America benchmark and optimizes it for higher yield while limiting expected tracking error to that parent. Income lean, core shape.sec.gov
• Tracks its index closely, among the strongest implementations in its peer group.
• A multi-billion-dollar fund holding about 80 developed-market names, paying distributions quarterly.

• HDEF Nine basis points. The overlay funds it sits beside run 0.42% (EFAA) to 0.83% (OVF), against a peer-group median near half a percent.
• Income comes from dividends the companies declare, not from selling calls, so no written option sits on the upside. Distributions arrive quarterly.
• The index screens for quality alongside yield, so a name has to clear more than a big payout number to get in.
• Live since 2015 and now a billion-dollar-plus fund, following the same MSCI index the whole way rather than rebuilding the strategy.

Worth knowing

• DIVI The tilt is mild by design: the index caps how far it can drift from its parent, so it reaches for less yield than funds built on hard high-yield screens.sec.gov
• Cheaper options sit in the same cohort (VYMI at 0.07%, SCHY at 0.08%), so the fee edge is over the category median, not over the largest index shops.
• Today's strategy dates to 2022, when the fund was renamed from Franklin LibertyQ International Equity Hedged ETF, so its 2016-onward record covers a different mandate.sec.gov

• HDEF No currency hedge in the mandate: euro, yen and pound moves against the dollar land in returns right alongside the stocks.
• Yield screening cuts a broad developed-markets universe down to roughly 120 names, so this is a slice of EAFE, not the full field.
• Moderately traded rather than a headline ticker, so spreads can widen in quiet stretches. Limit orders are the usual answer.

Full DIVI profile⁠

Full HDEF profile⁠