Using Dividend ETFs For Income

The search for yield continues. If at the start of 2019 investors were hanging their hats on higher rates to bolster portfolio yield, they have been sorely disappointed. Retirees in particular often rely on the fixed coupon payments of bonds to generate income. But with the 10-year Treasury yield last yielding only 1.75%—not far from record lows—they’ve had to look elsewhere for that income.

One place they can still find it is in the equity market; namely, dividend ETFs. Yields on these funds can be double that of the 10-year Treasury. For example, the Vanguard High Yield Dividend Yield ETF (VYM), the second-largest dividend ETF on the market, has a 30-day SEC yield of around 3.3%. The biggest of them all is the $38.8 billion Vanguard Dividend Appreciation ETF (VIG). Many dividend ETFs focus on one of two strategies—high yield or dividend growth.

Source: ETF.com

Related Articles:
- Successful Investors Take The Emotion Out
- 5 Under-Valued Dividend Growth Stocks
- Dividend Stocks vs. a Safe Distribution Rate
- 5 Select High-Yield S&P 500 Dividend Stocks
- High-Yield Managed Distribution Policy Funds