A Dividend Exchange-Traded Fund (ETF) is an investment vehicle holding assets in high dividend paying stocks or REITs. ETFs are built like conventional mutual funds, but priced and traded throughout the day like individual stocks. ETFs are passively managed around an index. That index may be the result of certain screens, such as companies with high dividends. Key ETF benefits include instant portfolio diversification, tax efficiency and transparency of cost and holdings. ETFs may be part of the core portfolio of an income-seeking or risk-averse stock investor.
Investing in dividend-paying stocks and/or ETFs is a key strategy for:
• Income and total return potential
• Possible reduced volatility
• Generally greater inflation protection than bonds
A Dividend Exchange-Traded Note (ETN) is a senior, unsecured, unsubordinated debt security issued by an underwriting bank. ETNs are not index funds, but they do share being linked to the return of a benchmark index. As debt securities, ETNs don't actually own anything they are tracking. Thus ETNs have an additional risk compared to ETFs: if the underwriting bank goes bankrupt, the investment might lose value, the same way a senior debt would. Most ETNs do not pay periodic dividends. ETNs have long maturity and symmetric return. They can be leveraged (often called BULL) and/or they can be inverse (often called BEAR).
ETF | Div% |
---|---|
UBS E-TRACS 2x Wells Fargo Bus Dv Cm | 14.97 |
Claymore CEF GS Connect ETN | 13.29 |
Vanguard Australian Shares High Yield | 13.19 |
First Trust STOXX Euro Select Div Idx | 12.13 |
WisdomTree Global ex-US Real Estate | 12.13 |
Lyxor ETF FTSE MIB Daily Leveraged A/I | 11.73 |
WisdomTree Europe SmallCap Dividend | 10.96 |
iShares Morningstar Multi-Asset Income | 10.69 |
iShares FTSE/EPRA European Property | 9.65 |
iShares Mortgage Real Estate Capped ETF | 9.44 |
SPDR EURO STOXX 50 | 9.20 |
UBS E-TRACS Mthly Pay 2x Mortg REIT ETN | 8.99 |
WisdomTree Europe Hedged Equity | 8.99 |
iShares MSCI Sweden Index | 8.95 |
Morgan Stanley Cushing MLP Hi Income | 8.91 |
WisdomTree Middle East Dividend | 8.88 |
SPDR S&P/ASX 200 Listed Property | 8.64 |
First Trust DJ Global Select Dividend | 8.48 |
YieldShares High Income ETF | 8.47 |
Market Vectors Pref Secs ex Fincls ETF | 8.45 |