Let’s face it — markets are more than just a little turbulent right now. Investors have many reasons to be feeling a fearful pinch in 2025. Recession still seems a distinct possibility, with tariffs arriving — and then departing — at a breakneck pace. A trade war is one thing, but a global trade war combined with a recession? That’s a recipe for portfolio struggles, before even getting into existing concentration risk. Adding a current income ETF could provide some meaningful ballast for a bumpy ride.
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Of course, not all current income ETF strategies are created equal. Sure, plenty of stock funds offer annual income distributions. Bond funds, too, can provide some options to consider for adding regular payouts to an overall portfolio. That said, for investors already set with their fixed income allocation, adding more reliable quarterly dividends via equities could help increase current income flows without shifting away from the stock and bond mix.
At the same time, as with fixed income, there are some really important advantages available by going with active rather than passive. In a strategy focused on investing in companies based on valuations and dividends, active scrutiny can really help a fund stand out.
That’s where a fund like TEQI can help. The T. Rowe Price Equity Income ETF (TEQI ) presents a strong opportunity, charging a 54 basis point fee for a value-leaning approach with quarterly dividend income. The strategy looks for companies believed to be undervalued based on metrics like low price-to-earnings ratio, above-average dividend yield, and low stock price relative to fundamentals.
Together, that approach has helped TEQI return 7.4% over one year per, T. Rowe Price data as of March 31. Not only has it performed comparatively well in its category, the fund has also put forward a solid 1.79% distribution yield per YCharts. Taken together, its active, current income appeal could make it a solid add for curious investors.
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