Searching for income, investors have been pouring into exchange-traded funds that hold big dividend-paying stocks. A favorite choice is Vanguard High Dividend Yield ETF (VYM), which yields 2.9%. But you can get more income with two ETFs that invest in smaller stocks: WisdomTree SmallCap Dividend (DES), which yields 3.7%, and WisdomTree MidCap Dividend (DON), with a yield of 3.2%. Besides solid dividends, the WisdomTree funds have also delivered strong total returns. During the past five years, the small-cap fund returned 8.9% annually, compared to 5.5% for the S&P 500 and 7.7% for iShares Russell 2000 ETF (IWM). WisdomTree Midcap returned 9.4% annually, compared to 7.3% for iShares Russell Midcap (IWR).
Not many funds focus on small-cap dividend stocks. Many academic studies have shown that small stocks outdo large ones over the long term. Dividend-paying small stocks do especially well. From the end of 1984 through the first quarter of this year, the dividend-paying members of the Russell 2000 outdid the nondividend payers by 2.6 percentage points annually, says Adam Peck, portfolio manager of Heartland Value Plus (HRTVX), a mutual fund that buys small-cap dividend stocks. Peck says that dividend stocks can be less volatile than nondividend payers. "Dividend payers tend to be more well-established companies with consistent cash flows," he says.
Source: The Street
Related Articles:
- 6 High-Dividend, Low P/E Value Stocks
- How Much Money Will You Need Before Retiring?
- The 2013 Dividend Achievers
- 5 Stocks With A Strong Cash To Dividend Coverage
- Dividend Stocks Are My Conviction
Small Dividend Stocks Deliver Hefty Returns
Posted by D4L | Wednesday, May 22, 2013 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
GameStop (NYSE:GME) lost about 40% of its market value over the past three years, as rising digital downloads and declining mall traffic thr...
-
In a capitalistic society, opportunities to generate (mostly) passive income are all around us. Dividend growth investing is one of the most...
-
These elite income producers have rallied this year. Their brilliance at producing passive income seems to have caught the market's eye ...
-
Since the market highs in July, stocks have been under considerable pressure. Indeed, 10-year Treasury yields are at the highest level since...
-
Buying dividend stocks can be tricky. Oftentimes, stocks that pay exorbitantly high dividends have underlying financial problems, and their ...
-
While optimism in the broader market remains robust – particularly for hyped-up sectors like technology – investors may still want to consid...
-
If you are looking for reliable dividends, these three Dividend Kings should be right up your alley. Dividends are paid at the discretion of...
-
A strong dividend investing strategy may be to focus on high-quality names that score well on several dividend-related metrics. In other wor...
-
Despite all that work, its valuation remains dirt cheap. That's a big reason why its distribution currently yields more than 9% despite ...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.