Search for Income Should Include International Markets

The U.S. is home to some of the most dependable dividend-paying stocks in the world, some of which have payout increase streaks measured in decades. And yes, S&P 500 member firms spend sizable sums annually on dividends.

Yet, that index’s dividend yield hovers around multi-decade lows. That confirms that equity income investors can benefit from looking abroad; the ALPS International Sector Dividend Dogs ETF (IDOG) makes that objective easier. The $547.1 million ETF, which turns 13 years old this month, leans into high dividend payers from across the ex-U.S. developed markets landscape.

However, IDOG is not home to yield traps. The ETF’s 3.41% distribution is more than triple that of the S&P 500, but it’s not so high as to imply the fund’s holdings are at risk of being dividend offenders.

“An unusually high yield can be a warning sign rather than an opportunity, reflecting a falling share price caused by deteriorating fundamentals or financial stress,” noted Morningstar’s Fernando Luque.

What’s Inside IDOG Matters

Obviously, geography mattes with multi-country ETFs such as IDOG. Specific to the ALPS fund, nine of its top 11 geographic weights are European nations. That’s pertinent to income investors because, in 2025, the largest European companies lifted dividends by an average of 6.2%. To its credit, IDOG holds what some experts view as the top European dividend payers, including Danish healthcare company Coloplast.

“We find policies surrounding shareholder returns highly appropriate,” observed Morningstar’s Debbie Wand. “Management has outlined levels of cash it intends to hold for any opportunistic acquisitions and directs excess returns to shareholders through special dividends, on occasion, when the firm does not see any attractive investment opportunities for those funds.”

Beyond Europe, IDOG’s nearly 10% weight to Japan stocks is potentially appealing to dividend investors with long-term perspectives. In recent years, Japan’s dividend growth has been impressive relative to the country’s history, indicating that companies there are prioritizing shareholder rewards. Dividends may remain a point of emphasis for some cash-rich Japan companies at a time when yields on government bonds there are elevated.

France is IDOG’s largest country weight at almost 20%, and that’s important. Some of the largest French companies have impressive yields as well long-term track records of increasing payouts.

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VettaFi LLC (“VettaFi”) is the index provider for IDOG, for which it receives an index licensing fee. However, IDOG is not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of IDOG.

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