What is the best high yield dividend ETF?
Cons. No guarantee of future dividends. Stock price declines may offset yield. Dividends are taxed in the year they are distributed to shareholders.
| Symbol | Name | 5-Year Return |
|---|---|---|
| XNTK | SPDR NYSE Technology ETF | 18.58% |
| UPRO | ProShares UltraPro S&P500 | 18.52% |
| PTF | Invesco Dorsey Wright Technology Momentum ETF | 18.33% |
| QQQ | Invesco QQQ Trust Series I | 18.27% |
| Symbol Symbol | ETF Name ETF Name | 1 Year 1 Year |
|---|---|---|
| VIG | Vanguard Dividend Appreciation ETF | 17.14% |
| VYM | Vanguard High Dividend Yield Index ETF | 15.88% |
| VYMI | Vanguard International High Dividend Yield ETF | 12.94% |
| VIGI | Vanguard International Dividend Appreciation ETF | 6.52% |
Cons. No guarantee of future dividends. Stock price declines may offset yield. Dividends are taxed in the year they are distributed to shareholders.
Vanguard High Dividend Yield ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
| Symbol | Name | Dividend Yield |
|---|---|---|
| XRMI | Global X S&P 500 Risk Managed Income ETF | 12.39% |
| YYY | Amplify High Income ETF | 12.27% |
| TUGN | STF Tactical Growth & Income ETF | 12.15% |
| SPYI | NEOS S&P 500 High Income ETF | 12.15% |
Dividend ETFs are passively managed, meaning the fund manager follows an index and does not have to make trading decisions often. Dividend ETFs are good investment options for investors that are risk-averse and income-seeking.
| Exchange-traded fund (ticker) | Dividend yield |
|---|---|
| SPDR S&P Dividend ETF (SDY) | 2.5% |
| Vanguard High Dividend Yield ETF (VYM) | 2.8% |
| WisdomTree U.S. Quality Dividend Growth Fund (DGRW) | 1.6% |
| FlexShares Quality Dividend Defensive ETF (QDEF) | 2.0% |
How to build an optimally diversified portfolio? Experts agree that for most personal investors, a portfolio comprising 5 to 10 ETFs is perfect in terms of diversification.
WisdomTree U.S. Quality Dividend Growth ETF (DGRW)
One of the best run dividend ETFs in the world has the added advantage of paying monthly dividends. DGRW's focus on both quality and growth characteristics makes it ideally suited for most portfolios even though the dividend yield is on the lower end.
Is it better to buy dividend stocks or dividend ETFs?
Dividend ETFs or Dividend Stocks: Which Is Better? Dividend ETFs can be a good option for investors looking for a low-cost, diversified and reliable source of income from their investments. Dividend stocks may be a better option for investors who prefer to choose their own investments.
Investors in Higher Tax Brackets: Given the potential tax inefficiencies associated with dividends (compared to stock buybacks), those in higher tax brackets might want to avoid dividend-focused ETFs.
Over time, the cash flow generated by those dividend payments can supplement your Social Security and pension income. Perhaps, it can even provide all the money you need to maintain your preretirement lifestyle. It is possible to live off dividends if you do a little planning.
VYM Dividend Information
The dividend is paid every three months and the last ex-dividend date was Mar 15, 2024.
| Chg (%) | Return (%) as of Mar 31, 2024 | |
|---|---|---|
| 1 Day | 1Y | |
| Vanguard High Dividend Yield (VYM) ETF | -0.20 | 18.31 |
| US Inflation Adjusted return | 14.33 | |
| Returns over 1 year are annualized | Available data source: since Jan 1976 |
Vanguard is a large investment advisor offering mutual funds and ETFs, many of which pay dividends. Most of Vanguard's ETF products pay monthly or quarterly dividends.
- ARR. ARMOUR Residential REIT Inc. 18.38.
- ORC. Orchid Island Capital Inc. 8.31. 0.12.
- AGNC. AGNC Investment Corp. 9.15. ...
- OXSQ. Oxford Square Capital Corp. 3.16. ...
- EARN. Ellington Residential Mortgage REIT. 6.72. ...
- SLRC. Solar Capital Ltd. 15.20. ...
- PFLT. PennantPark Floating Rate Capital Ltd. 11.37. ...
- MAIN. Main Street Capital Corporation. 47.62.
What Is a Good Dividend Yield? Yields from 2% to 6% are generally considered to be a good dividend yield, but there are plenty of factors to consider when deciding if a stock's yield makes it a good investment. Your own investment goals should also play a big role in deciding what a good dividend yield is for you.
Here are some examples of 10-year Treasury ETFs: iShares 7-10 Year Treasury Bond ETF (IEF) Vanguard Long-Term Treasury ETF (VGLT) Schwab Long-Term US Treasury ETF (SCHQ)
The potential for dividend cuts and fluctuating payouts are just two of the risks that investors need to consider. The potential for dividend cuts and fluctuating payouts are just two of the risks that investors need to consider.
What is the downside of ETFs?
For instance, some ETFs may come with fees, others might stray from the value of the underlying asset, ETFs are not always optimized for taxes, and of course — like any investment — ETFs also come with risk.
9 In other words, dividends are not guaranteed and are subject to macroeconomic and company-specific risks. Another downside to dividend-paying stocks is that companies that pay dividends are not usually high-growth leaders.
JPMorgan Chase & Co. (NYSE:JPM), Exxon Mobil Corporation (NYSE:XOM), and Bank of America Corporation (NYSE:BAC) are some of the most profitable stocks offering dividends to shareholders.
- Verizon Communications VZ.
- Johnson & Johnson JNJ.
- Philip Morris International PM.
- Altria Group MO.
- Comcast CMCSA.
- Medtronic MDT.
- Pioneer Natural Resources PXD.
- Duke Energy DUK.
ETF issuers collect any dividends paid by the companies whose stocks are held in the fund, and they then pay those dividends to their shareholders. They may pay the money directly to the shareholders, or reinvest it in the fund.
