WXOZ is an exchange-traded fund that tracks global stocks outside Australia while prioritizing carbon-aware investing. Think of it as a world portfolio that avoids high-carbon companies. The fund holds major multinational corporations across developed markets, excluding Australian equities. It's designed for investors wanting international diversification without the carbon footprint concerns. The fund holds hundreds of global businesses, from tech giants to industrial companies.

Dividend Snapshot

With a 7.07% yield on a share price of $48.84, WXOZ delivers approximately $3.46 in annual distributions per share. The yield is unfranked, meaning no tax credits apply. The fund's 1-year return of -2% shows recent weakness in global equity markets. Despite short-term headwinds, the fund continues distributing from underlying dividend payments and capital management strategies. Most distributions come from dividends paid by the constituent companies.

Is the Dividend Sustainable?

The sustainability question here is nuanced. WXOZ's high yield largely reflects market weakness rather than exceptional company fundamentals. Global equity markets faced pressure in the past year, pushing the fund's price down while dividend payments remained relatively stable. The fund's carbon-filtering approach adds an extra layer of sustainability consideration. However, relying solely on this fund for dividend income carries risks. The unfranked nature means Australian taxpayers receive no franking credits benefit. Long-term sustainability depends on global economic conditions and company profitability across holdings. The -2% annual return suggests the fund prioritizes distributions over capital growth, which can eventually impact sustainability if markets deteriorate further.

Key Risks

Unfranked dividends create a tax disadvantage for Australian residents. Currency fluctuations affect returns when converting foreign dividends to AUD. Global economic slowdowns directly impact the companies within the fund. The carbon-filtering strategy excludes sectors like energy, potentially limiting returns in strong commodity cycles. The -2% one-year return demonstrates recent volatility and underperformance. You're also exposed to concentration risk in major developed markets, particularly the US. Interest rate movements can affect both equity valuations and the attractiveness of bond alternatives.

FAQ

Can I rely on WXOZ for consistent income? While WXOZ has delivered high yields, the recent -2% return and unfranked status make it better suited as part of a diversified income portfolio rather than the sole income source. Consider your overall tax situation.

Why is WXOZ's yield higher than many ASX stocks? The combination of global market weakness and the fund's distribution policy creates the 7.07% yield. It's not necessarily a sign of strength but rather reflects current market valuations.

How often does WXOZ distribute? Most ETFs distribute quarterly or semi-annually. WXOZ typically pays distributions multiple times yearly, providing regular income to shareholders.