RDVY

About RDVY

The Fund will normally invest at least 90% of its net assets (including investment borrowings) in the securities that comprise the Index. The Fund, using an indexing investment approach, attempts to replicate, before fees and expenses, the performance of the Index. The Index is owned, developed, calculated and maintained by Nasdaq, Inc. (the “Index Provider”). The Index Provider may, from time to time, exercise reasonable discretion as it deems appropriate in order to ensure Index integrity. According to the Index Provider, the Index measures the performance of a selection of securities that have increased their dividend value over the previous three year and five year annual periods. In order to be eligible for inclusion in the Index, a security must be included in the Nasdaq US Benchmark IndexTM, meet the size and liquidity requirements of the Index, and must not be classified as a Mortgage Real Estate Investment Trust or a Real Estate Investment Trust according to the Industry Classification Benchmark. A security must also be issued by companies that meet the following characteristics: (i) have paid a dividend in the trailing twelve-month period greater than the dividend paid in the trailing twelve-month period three and five years prior; (ii) have a positive earnings-per-share in the trailing 12-month period greater than earnings-per-share in the trailing 12-month period three years prior; (iii) have a cash-to-debt ratio greater than 50%; and (iv) have a trailing 12-month period payout ratio no greater than 65%. If a company issues more than one security, only the security with the highest three-month average daily traded value generally is considered for inclusion in the Index. The Fund may invest in companies with various market capitalizations and depositary receipts. Securities that meet these eligibility thresholds are ranked in descending order by dollar dividend increase over the previous five year period and by current dividend yield and ascending order by payout ratio. These ranks are aggregated into a single score with the 50 securities with the lowest aggregate rank selected for inclusion in the Index and are equally weighted. In the event of a tie, the security with the higher dividend yield is given priority. A review is then undertaken to determine if the Index has exposure to any Industry Classification Benchmark industry in excess of 30%. If the Index has exposure to an industry in excess of 30%, the highest ranking component within that industry is removed and replaced with the next-ranked eligible security from a different industry. The Index is reconstituted annually and rebalanced quarterly and the Fund will make corresponding changes to its portfolio shortly after the Index changes are made public. The Index’s quarterly rebalance schedule may cause the Fund to experience a higher rate of portfolio turnover. The Fund will be concentrated in an industry or a group of industries to the extent that the Index is so concentrated. As of December 31, 2024, the Fund had significant investments in financial companies, although this may change from time to time. The Fund's investments will change as the Index changes and, as a result, the Fund may have significant investments in jurisdictions or investment sectors that it may not have had as of December 31, 2024. To the extent the Fund invests a significant portion of its assets in a given jurisdiction or investment sector, the Fund may be exposed to the risks associated with that jurisdiction or investment sector.