Tired of market selloff drama and turmoil? It may be time to add some dividend exposure via income ETFs. Income can help portfolios ride out volatility, whether from big selloffs or new government policies. ETFs provide straightforward avenues to get that exposure. Thanks to their flexibility, transparency, and tax efficiency, income ETFs can provide a meaningful boost.
See more: Diversify Into Emerging Markets Upside With Active ETF AVEM
What kind of income ETFs are out there, then? American Century Investments offers a pair that merit a closer look. The American Century Short Duration Strategic Income ETF (SDSI ) and the American Century Multisector Floating Income ETF (FUSI ) each provide different ways to invest in current income.
SDSI charges 32 basis points (bps) for its approach. The strategy actively invests in short-duration fixed income securities. SDSI looks to provide capital appreciation in addition to income. It does so via holding a variety of short-duration debt securities. Specifically, that includes a variety of offerings including bank loans, collateralized debt obligations, and preferred stocks, too.
FUSI, meanwhile, charges a 28 bps fee to actively invest in a global portfolio of mostly investment grade floating rate securities. The income ETF primarily targets CLOs, floating rate commercial mortgage securities, and asset-backed securities, among other categories. While it does normally invest in investment-grade debt, the fund can invest in some securities below investment grade.
Together, the duo of income ETFs have produced some solid metrics. SDSI has returned 6.38% over the last year as of March 31, 2025, per American Century Investments data. The strategy offered a 5.7% yield to maturity as of March 31, as well as a 5.36% 12-month distribution rate.
FUSI, meanwhile, has returned 5.9% over the last one year, also according to American Century Investments, as of the same date. The strategy has also offered some solid yields. The current income ETF provided a 5.83% distribution rate over twelve months, itself.
Taken together, the pair of income ETFs could help investors ride out uncertainty. With further selloffs potentially on the cards, income ETFs, especially with an active approach, could intrigue.
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