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Looking for a steady income stream to provide stability in your portfolio? Here are five of the best dividend ETFs to invest in this year, ranked by assets.
As we consider the market trends, investors should anticipate what to look out for in 2020 and look for ways to construct a diversified portfolio with low-cost exchange traded fund strategies to gain efficient ...
The pioneering retailer saw its market cap fall below the threshold that would allow it to be held in a popular fund. Now market capitulations have sent it back over that level.
After a stellar year, the SPDR S&P 500 ETF (SPY) continued to strengthen in 2020 and is already up 3.1% so far, breaking out with six new all-time highs in the first 12 trading days. Despite the strong gains, many investors still remain bullish on the equity market outlook. According to the survey, 76% of wealthy investors place a high grade on the U.S. economy, and there has been a 16% jump among investors whom expect the market to rise by as much as 5% this quarter.
With the decade of historically low interest rates seemingly set to bleed into the next, dividend stocks are poised to retain their position as an attractive alternative to bonds as a source of yield for income investors.
Some dividend exchange traded funds have requirements regarding the stocks that qualify for admission into the portfolio. Others, well, they take the requirement gambit up a notch and, in some cases, investors benefit. The SPDR S&P Dividend ETF (NYSE: SDY) is in the latter camp.
Dividend yields recently surpassed those of benchmark Treasury notes for the first time since 2016, potentially providing further support for equity markets and dividend-paying stock exchange traded funds in this prolonged low-rate environment. According to Bank of America data, dividend yields for the S&P 500 index at 1.89% surpassed the yield of 10-year Treasuries at 1.5% for the first time in three years, CNBC reports. “Stocks are a ‘no brainer’ vs. bonds,” Bank of America analyst Savita Subramanian said in a note.
The SPDR S&P Dividend ETF (NYSE: SDY) has been getting some press lately and one reason for that is the fund's impressive mandate of only holding stocks that have boosted payouts for 20 consecutive years. “The S&P High Yield Dividend Aristocrats has diversified sector exposures, with some sector bets, given different dividend-paying practices among sectors,” said S&P Dow Jones Indices in a recent note.
As was recently noted here, SDY tracks the S&P High Yield Dividend Aristocrats Index, a benchmark that requires member firms to have minimum dividend increase streaks of 20 years, and that index has a lengthy track record of topping the S&P Composite 1500 Index.
As exchange traded fund investors look to the rest of the year ahead, many are considering factor-based or alternative indexing methodologies for smarter investment strategies. In the recent webcast, Q4 ...
With jolts of volatility throughout the first half of the year, investors need to consider smart strategies to adapt to changing conditions in a late business cycle. In the upcoming webcast, Q4 Market ...
Bank of America believes that the S&P 500 will close 2019 unchanged, but see dividend payers as superior to bonds for the short and long terms.
With rates depressed and attractive yields hard to come by in the fixed-income market, investors may want to consider dividend-paying stocks and related ETFs. Goldman Sachs argued that dividend payers ...
Want relatively safe income from high dividend stocks? For yield that beats the market average, up to more than double that much, check out these funds.
The Federal Reserve did what investors were hoping for Wednesday -- that is, lowering interest rates. Perhaps it was a case of selling the news or market participants wanting an 0.5% rate cut instead of the 0.25% the Fed delivered, but stocks were drubbed in the final trading day of July.Source: Shutterstock In cutting rates by 25 basis points, the Fed left the door open for another rate reduction later this year. Right now, it appears likely that another rate cut will indeed happen. Couple that with the $13 trillion in negative yielding bonds around the world and the low-interest-rate environment seen the world over and you have a recipe for increasing the allure of a beloved asset class: dividend stocks.The amount was not massive, but a handful of dividend exchange-traded funds (ETFs) hit record highs on Wednesday and some data points indicate investors have recently been piling into dividend ETFs, perhaps in anticipation of ongoing declines in Treasury yields.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 8 of the Most Shorted Stocks in the Markets Right Now With the U.S. remaining one of the dominant forces in global dividend growth and with interest rates here declining, investors can mix and match both dividend growth and high dividend ETFs in the current market environment. Here are some of the dividend ETFs that are primed to deliver for investors over the rest of 2019 and beyond. Dividend ETFs: SPDR S&P Dividend ETF (SDY)Expense Ratio: 0.35% per year, or $35 on a $10,000 investment.The SPDR S&P Dividend ETF(NYSEARCA:SDY) is one of the dividend ETFs that hit all-time highs on July 31 and one that has recently been luring investors. For the week ending July 30, SDY garnered $1.26 billion in new assets, a total exceeded by just two other ETFs over that period.The SPDR S&P Dividend ETF is an appropriate fund for this climate because it dances between high dividend and payout growth.SDY tracks the S&P High Yield Dividend Aristocrats Index. Obviously, that benchmark has "high yield" in its name, but this dividend ETF yields just 2.4%. More importantly, SDY's 112 components must have dividend increase streaks of 20 years to be included in the fund. While SDY is not necessarily a proper high-dividend ETF, it can provide some leverage to declining interest rates because rate-sensitive sectors such as consumer staples, utilities and real estate combine for nearly a third of the fund's weight.SDY is appropriate for a variety of investors, but it might be best deployed by conservative investors looking to reduce portfolio volatility. Over the past three years, SDY is trailing the S&P 500 by a healthy margin, but the dividend ETF has been significantly less volatile and its maximum drawdown over that span was well bellow that of the broader market. O'Shares FTSE Russell Small Cap Quality Dividend ETF (OUSM)Source: Shutterstock Expense Ratio: 0.48%The O'Shares FTSE Russell Small Cap Quality Dividend ETF (NYSEARCA:OUSM) is an ideal fund for risk-averse investors to tap small-cap stocks, an asset class that data suggest is increasingly fertile territory for dividend seekers.OUSM tracks the FTSE USA Small Cap ex Real Estate 2Qual/Vol/Yield 3% Capped Factor Index, which "is designed to reflect the performance of publicly-listed small-capitalization dividend-paying issuers in the United States exhibiting high quality, low volatility and high dividend yields," according to O'Shares. * 7 A-Rated Stocks Under $10 Interestingly, OUSM is home to nearly 220 stocks, or more than triple the roster of the Russell 2000 Dividend Growth Index. Another interesting factoid for investors to consider is this dividend ETF's return on assets (ROA), a key metric in evaluating payout growth potential. OUSM has an ROA of 8.2% compared to just 0.3% for the Russell 2000. So it's probably not surprising that the dividend ETF is outperforming the small-cap benchmark over the past year. Global X SuperDividend U.S. ETF (DIV)Expense Ratio: 0.45%The Global X SuperDividend U.S. ETF (NYSEARCA:DIV) makes good on the promise of being a "super dividend" play with a trailing 12-month dividend yield of 7.3%, but this dividend ETF is struggling this year with a gain of just 3%. One of the obvious drags on this dividend ETF is energy exposure, be it via master limited partnerships (MLPs) or traditional energy stocks. Those asset classes combine for almost 20% of DIV's weight, though MLPs, broadly speaking, have been solid this year.Despite the struggles, this is one dividend ETF that could be poised to bounce back as markets price in expectations of more dovish Fed action. DIV is loaded with rate-sensitive asset classes. That includes mortgage REITs, consumer staples and utilities stocks combining for over 43% of DIV's roster.In addition to having a lower beta and lower annualized volatility relative to the S&P 500, this dividend ETF has another perk, particularly for investors looking for regular income.It pays a monthly dividend. ProShares MSCI Europe Dividend Growers ETF (EUDV)Expense Ratio: 0.55%Remember that $13 trillion in negative-yielding bonds I mentioned earlier? A lot of it resides in Europe, meaning if an investor picks the wrong European bond, he or she will lose money. The ProShares MSCI Europe Dividend Growers ETF (CBOE:EUDV) is a dividend ETF that is a superior option to most European sovereign debt at the moment.Developed European economies, namely the U.K. and Switzerland, are among the better dividend growth alternatives to the U.S. This dividend ETF is a play on payout growth as its index requires a minimum dividend increase streak of a decade. In Europe, that's an exclusive club because EUDV has just 34 holdings and British and Swiss stocks combine for over the fund's geographic exposure. * The 10 Best Stocks to Invest in for August About 40% of EUDV's currency exposure is in euros, a trait that could benefit investors if the European Central Bank (ECB), as is widely expected, unleashes more monetary stimulus. In fact, a case can be made that the ECB has no choice but to unfurl easy monetary policy to lift some slow-moving economies in the Eurozone. WisdomTree Emerging Markets High Dividend Fund (DEM)Expense Ratio: 0.63%The WisdomTree Emerging Markets High Dividend Fund (NYSEARCA:DEM) fits the bill as a high-dividend ETF as highlighted by its distribution yield of 4.8%, or more than double the dividend yield on the MSCI Emerging Markets Index. Oh, and this dividend ETF is beating the emerging markets benchmark by nearly 200 basis points this year with lower volatility.As is to be expected, emerging-markets dividend ETFs look and act much different than U.S. equivalents. Due to the fact that this universe of dividend payers is more fractured than Europe or the U.S., it is reasonable to expect some emerging markets dividend ETFs have geographic concentration risk and that is true of DEM. The WisdomTree fund nearly two-thirds of its weight to Taiwan, China and Russia.And while DEM is acting less turbulent than the MSCI benchmark this year, the dividend ETF has heavy cyclical exposure with about 54% of its weight allocated to financial, energy and materials stocks. Among other traits, one in favor of DEM is the potential for a swath of interest rate cuts across developing economies, such as the one unveiled by Brazil on Wednesday.As of this writing, Todd Shriber owned shares of DEM. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 8 of the Most Shorted Stocks in the Markets Right Now * 7 Charts That Should Concern Marijuana Stock Investors * 8 Monthly Dividend Stocks to Buy for Consistent Income The post 5 Dependable Dividend ETFs to Invest In appeared first on InvestorPlace.