Income-oriented equity investors are always looking for attractive dividend yields at reasonable valuations. But many investors are now finding higher dividends in parts of the market that have become expensive.

We believe Oppenheimer S&P Ultra Dividend Revenue ETF (RDIV), which invests in 60 of the highest dividend yielding large- and mid-cap stocks in the S&P 900 Index, offers an appealing alternative. The portfolio reweights those high dividend-yielding stocks by revenue. Further, its systematic quarterly rebalancing helps it maintain high yields and low valuations, while enhancing its potential to deliver strong performance.

Quarterly rebalancing has historically allowed RDIV to buy low and sell high. By placing a 5% cap weighting on any one stock, the portfolio avoids overexposure. Using the S&P 900 universe for stock selection avoids the common behavioral bias of overweighting large-cap stocks when searching for dividends.