Small-Cap Dividend Risks and Cuts, The Quality Difference |

Small-Cap Dividend Risks and Cuts, The Quality Difference

A Quality dividend investing approach may help reduce the risk of dividend cuts or suspensions. OUSM’s definition of dividend quality includes measures for dividend growth and coverage.

Negative dividend actions (July 2020):

10% of stocks in OUSM announced suspending their dividend vs. 13% for the dividend paying stocks in the Russell 2000.
Only 3% of stocks announced decreasing their dividend vs. 7% for the dividend paying stocks in the Russell 2000.

Positive dividend actions (July 2020):

72% of stocks in OUSM announced maintaining their dividend vs. 66% for the dividend paying stocks in the Russell 2000.
14% of stocks in OUSM announced increasing their dividend vs. 11% for the dividend paying stocks in the Russell 2000.

% OF TOTAL	DECREASE	INCREASE	INITIATE	REINITIATE	MAINTAIN	SUSPEND	UNKNOWN	TOTAL
OUSM	3.0%	13.6%	0.0%	0.0%	71.7%	9.6%	2.0%	100%
Russell 2000 DIVIDEND PAYERS	6.8%	10.6%	0.7%	0.2%	66.2%	12.7%	2.9%	100%

OUSM vs. Russell 2000 Dividend Payers

	DECREASE		SUSPEND		INCREASE		INITIATE		REINITIATE		MAINTAIN		UNKNOWN		TOTAL
	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000	OUSM	Russell 2000
Communication Services	0	3	1	9	2	2	0	0	0	1	2	6	0	0	5	21
Consumer Discretionary	3	5	11	38	1	7	0	0	0	0	15	34	1	2	31	86
Consumer Staples	0	2	0	1	3	6	0	0	0	0	3	18	0	0	6	27
Energy	0	6	0	10	3	3	0	0	0	0	0	7	0	6	3	32
Financials	1	25	0	3	8	30	0	4	0	1	49	276	1	7	59	346
Health Care	0	0	1	3	0	0	0	0	0	0	7	14	0	0	8	17
Industrials	1	6	3	17	5	11	0	0	0	0	33	91	2	3	44	128
Information Tech	1	1	3	5	0	7	0	0	0	0	16	24	0	2	20	39
Materials	0	0	0	6	0	4	0	1	0	0	0	33	0	3	0	47
Real Estate	0	11	0	19	0	12	0	0	0	0	0	53	0	1	0	96
Utilities	0	0	0	0	5	10	0	1	0	0	17	21	0	1	22	33
Total	6	59	19	111	27	92	0	6	0	2	142	577	4	25	198	872

Source: Bloomberg Finance L.P. Data retrieved 7/31/2020. Dividend Paying stocks in Russell 2000: 872, OUSM Number of Stocks: 194. Past performance does not guarantee future results. Investors cannot directly invest in an index.

Before you invest in O’Shares ETF Investments Funds, please refer to the prospectus for important information about the investment objectives, risks, charges and expenses. To obtain a prospectus containing this and other important information, please view or download a prospectus. Read the prospectus carefully before you invest. There are risks involved with investing including the possible loss of principal.

Concentration in a particular industry or sector will subject the Funds to loss due to adverse occurrences that may affect that industry or sector. The Funds may use derivatives which may involve risks different from, or greater than, those associated with more traditional investments. A Fund's emphasis on dividend-paying stocks involves the risk that such stocks may fall out of favor with investors and underperform the market. Also, a company may reduce or eliminate its dividend after the Fund's purchase of such a company's securities. Returns on investments in foreign securities could be more volatile than, or trail the returns on, investments in U.S. securities. Exposures to foreign securities entail special risks, including political, diplomatic, economic, foreign market and trading risks. In addition, a Fund's investments in securities denominated in other currencies could decline due to changes in local currency relative to the value of the U.S. dollar, which may affect the Fund's returns. See the prospectus for specific risks regarding the Funds.
The securities of small capitalization companies are often more volatile and less liquid than the stocks of larger companies and may be more affected than other types of securities during market downturns. Compared to larger companies, small capitalization companies may have a shorter history of operations, and may have limited product lines, markets or financial resources.
Companies involved with Internet technology and e-commerce are exposed to risks associated with rapid advances in technology, obsolescence of current products and services, the finite life of patents and the constant threat of global competition and substitutes.
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Small-Cap Dividend Risks and Cuts, The Quality Difference

OUSM vs. Russell 2000 Dividend Payers

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