There is a new ETF iShare Dow Jones Select Dividend Index Fund (ticker: DVY). It holds 50 of the higest yielding firms of the Dow Jones total market. It has a yield of about 3.4% and I think it is a serious fund to consider for dividends seekings like some of us.
With the dividend, the stable price, and a covered call strategy, I think it looks as good as RPM.
I am looking to put some good money in it. Anyone has any idea, input on it?
Forget the ETF and invest in RPM and other solid dividend yielding stocks. Pick 4 or 5 stocks from different sectors such as AT, NCC, SLE, GM, PEG, MRK etc. that have a good chance for growth in value of stock and just collect 3-4% dividend yield/year. Then cash in at the end of a few years and collect 5-10%/year capital gains!
You will have safe hedge against riskier investments that will probably beat the S+P500 and most mutual funds.... and the ETF you recommend as well.
When I looked at DVY on Yahoo it showed only a 2.13% yield. Is Yahoo wrong? Probably. One of the articles said that the Dow Jones div. yield was 2.13% (coincidence?)and that the DVY yield was 3.85%. Of course even using the higher value you still pay a .40% annual fee, thereby giving up a chunk of the yield.. and for what would appears to be very little added value. With on-line brokerage fees as low as they are, and depending on the amount of you investment, you may be better off doing a stock screen and selecting your own set of high-yield stocks.
Thank you for your input. I think you are right all along except for one small thing: It may suits for people wanting to do some indexing and getting "bush-tax type" income. The .40% fee is in line with the index-funds and it is a small fee to pay to hold a portfolio on 50 stocks paying dividends.