The International Dividend ETF Play You Might Be Missing
Think dividend strength only comes from the S&P 500? Think again.
The importance and impact of dividends when investing over a long time horizon are well established. However, when dividend investing is discussed, investors instinctively think of U.S. equities, without adequately considering exposure to non-U.S. equities.
While many investors know the S&P 500 Dividend Aristocrats Index —tracking companies that have raised dividends for 25 straight years—there’s a similar benchmark for international stocks: the S&P International Dividend Aristocrats Index.
This index provides exposure to high-dividend-yielding, non-U.S. companies within the S&P Global BMI that have followed a policy of increasing or maintaining dividends for at least 10 consecutive years.
The World’s Aristocrats Are Challenging the S&P 500
Over the past five years, since the S&P International Dividend Aristocrats Index launched on April 30, 2018, international dividend-paying stocks have largely kept pace with their U.S. counterparts. In fact, so far in 2025, the international index has begun to show signs of outperformance.
Investing internationally gives investors access to a broader set of opportunities and exposure to the growth of companies around the globe.
According to the most recent monthly factsheet, while the S&P International Dividend Aristocrats Index has notable exposure to Canada, it also includes companies from a wide range of developed markets, offering diversified global exposure.
Investing in International Dividends via ETFs
For Canadian investors interested in gaining international dividend equity exposure, there are ETFs solutions that facilitate this, namely:
The Invesco S&P International Developed Dividend Aristocrats ESG Index ETF (IIAE) invests in 100 high-yielding companies across developed markets in Europe, the Middle East, Africa, and Asia Pacific. These companies have maintained or increased their dividends for at least 10 consecutive years. The fund tracks an index that also incorporates ESG criteria, excluding North America and South Korea.
The Manulife Smart International Dividend ETF (DIV.B), utilizes an efficient quantitative approach that focuses on international dividend-paying companies that have the potential to pay a consistent and growing dividend over time – not just the highest dividend payers in the market.
The methodology used by the portfolio manager(s) optimizes the fund’s holdings, resulting in a portfolio that differs significantly from the broad MSCI EAFE index.
The Purpose International Dividend Fund (PID) invests in high-quality dividend-paying equity securities of international issuers, excluding the United States and Canada, that can grow their businesses and dividends for shareholders in the future.
PID is structured to reduce risk by using both quality and financial risk screens to exclude companies that have low financial strength and limited capacity for business and dividend growth.
Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.
