Even with yields rising, you’ll be hard-pressed to find Treasury notes giving fixed income investors beyond 3%. Interest rates are still relatively low by historical standards, so reaching for yield beyond bonds is an option with dividend ETFs like DIV.
DIV keeps dividends within the safer confines of U.S. debt. Per its fund description, DIV seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx SuperDividend® U.S. Low Volatility Index. Its 30-day SEC yield of almost 5% (as of December 16, 2021) and its year-to-date gain of over 21% highlight the ETF’s dual benefits.
With its capital, the fund invests at least 80% of its total assets in the securities of the underlying index. The underlying index tracks the performance of 50 equally weighted common stocks, including Master Limited Partnerships (MLPs) and Real Estate Investment Trusts (REITs) that rank among the highest dividend-yielding equity securities in the United States.
DIV gives investors:
- High income potential: DIV accesses 50 of the highest dividend-paying equities in the United States, potentially increasing a portfolio’s yield.
- Monthly distributions: DIV makes distributions on a monthly basis and has made distributions each month for over seven years. With rates scheduled to rise in 2022 around the world, this could translate to higher yields.
- Low volatility: DIV’s index methodology screens for equities that have exhibited low betas relative to the S&P 500 in an effort to produce low volatility returns.
- A 30-day SEC yield of 4.80%
More Yield Overseas
For bolder investors who want yield with the added risk, there are options for dividend-producing equities overseas with SDIV. The fund seeks investment results that correspond generally to the price and yield performance of the Solactive Global SuperDividend® Index, which tracks the performance of 100 equally weighted companies that rank among the highest dividend-yielding equity securities in the world, including emerging market countries.
SDIV features:
- High income potential: Potentially increasing a portfolio’s yield, SDIV accesses 100 of the highest dividend-paying equities around the world.
- Monthly distributions: SDIV makes distributions on a monthly basis and has made distributions each month for over 10 years.
- Global exposure: Investing in equities from around the globe can help diversify both geographic and interest rate exposure.
- A 30-day SEC yield of 9.66%
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