Advice on smartshares

[lawson]

Hi I'm resurrecting an old thread rather than starting a new one because my question relates to smartshares and I was also interested in any advice/thoughts anyone might have.

Smartshare have a NZ Dividend (DIV) ETF it usually has twice yearly distributions.(June & December)

They list the following companies as being the top 10 holdings

Contact Energy 10.32%
Meridian 9.5%
Spark 9.05%
Infratil 7.34%
Chorus 6.87%
Mercury 6.53%
Ebos 5.45%
Genesis 4.86&
Ryman 4.67%
Goodman Property Trust 4.33%

They have announced yesterday that they will not pay the second dividend for the year usually paid December. The notice said:

Smartshares Distribution – November 2020 Smartshares NZ Dividend ETF (DIV) pays semi-annual distributions, where available, based on income received during that distribution calculation period from the underlying securities.For the period 20 May 2020 to 18 November 2020, DIV has not received sufficient income to pay a distribution. It is expected DIV will pay the next distribution for the period ending 31 May 2021.

However, the top 10 holdings they list (that I detailed above and which represent approx 70% of the ETF) all paid their dividend. None of them missed. Ryman & GMT are a little down but Chrous and Ebos's dividends were a little up. How can there be nothing to distribute? What's the point of investing in a DIvidend ETF invested in underlying companies that did pay a dividend but then the ETF says it can't?

I was literally about to invest some money on behalf of my mother into DIV - as it seemed a diversified, low fee option and she just needs a range of income investments that will beat the bank and I thought this might be one to include but now I am really puzzled as to how this is working?

Does anyone have any thoughts or have any experience of being with smartshares?

Thanks

[Jay]

My question would then be what have they done /what are doing with the diviends they have received? - all profit for themselves?
You would think they may pay a reduced dividend which would be fair enough

[Norwest]

That is extremely underhanded... I bet they didn't cut their management fee though!

[arekaywhy]

Where was the notice about not paying dividend? I have checked their website and nothing. I am a holder of that ETF and no notice has been given to me.

[Chickens]

If lawson hadn't pointed it out, I certainly wouldn't have known.

There may be a less obscure way, but refer to https://www.nzx.com/companies/DIV/announcements;

Look at the announcement: DIV Distribution and Taxable Bonus Issue Notice ("Smartshares Limited is pleased to announce . . . . ")

At the bottom there's a link to DIV Distribution Letter which states "For the period 20 May2020 to 18 November2020, DIV has not received sufficient income to pay a distribution."

I'm somewhat disappointed, and I don't think this decision is consistent with the intended spirit of the DIV smartshare.

[turbo]

Same. I wouldn't have known either if Lawson hadn't mentioned it. Had to go looking for it. Bit disappointing as the reason for investing in that ETF is for the dividends

[arekaywhy]

yeah, it's in the name...which is kind of important to those investing their hard earned into it.

You'd think this would be so frikken important that they would alert investors loudly, but no, which looks sneaky and furtive

VERY disappointed, especially given the underlying shares have paid out dividends

[Banksie]

Looks like they might have made a mistake.
"Smartshares Limited, the manager of the Smartshares Exchange Traded Funds, announces that some of the information in the 23 November 2020 announcement is incorrect. It will release an amended announcement later this morning."

https://www.nzx.com/companies/DIV/announcements

Thanks for bringing this up. I moved my SmartShares to InvestNow, because they are easier to manage and view through them. The downside is I don't seem to get the announcements. Something I need to follow up.

[Chickens]

Updated DIV distribution notice;

Amendment: DIV Distribution and Taxable Bonus Issue Notice

Roughly 2c divvy, ex-div date 01 Dec, payable 18 Dec 2020.

(what were they thinking, announcing no dividend for a "Dividend" fund. I bet that prompted a lot of "constructive feedback")

[arekaywhy]

yeah they penised that up badly