High dividend yield funds have become increasingly popular over the years. With the growth of passive investing, more investors are looking for a steady stream of income without having to spend a lot of time researching individual stocks. While dividend stocks can provide a steady stream of income, investing in them can be tricky and requires a high amount of research.
Investors must evaluate a company’s financial health, management team, and industry trends to determine if it is a good investment. This can be a time-consuming process, which is why many investors turn to dividend yield funds. High dividend ETFs are a type of dividend yield fund that invests in a basket of high dividend-paying stocks.
These funds are a great way to gain exposure to a diversified portfolio of dividend-paying stocks without having to conduct extensive research. High dividend ETFs track indexes of dividend-paying stocks and provide investors with a simple, low-cost way to invest in high dividend stocks.
Disclaimer: This is not financial advice and you are responsible for your own investment decisions. When investing capital is at risk. This article may contain affiliate links.
Which Dividend ETFs are the Best?
Dividend yield funds are a great way to generate income, especially during bear markets when growth stocks underperform. Dividend stocks are typically companies with a history of stable earnings and cash flow, which allows them to pay out regular dividends to their shareholders. When the stock market experiences a downturn, investors often flock to dividend stocks for their stability and reliable income stream.
There are many options for a high dividend yield ETF. All of which offer variable levels of risk and yield. The below are some of the best examples of high dividend yield ETFs available through some various platforms. One of the easiest way to diversify your portfolio with high dividend ETFs is with the Lightyear app. All of the funds below are available with this platform.
This makes it easy for you to start investing in High Dividend Yield funds. There is no upfront or monthly fee to download and use the app. You only pay fees on the stocks or funds you choose to invest in. In fact, you’ll earn around 4% interest on any cash held in your Lightyear account. This means you make money, even if you’re not invested in high dividend stocks!
iShares Emerging Markets Dividend ETF (DVYE):
The iShares Emerging Markets Dividend ETF (DVYE) invests in companies that are located in emerging markets such as China, Brazil, and India. The fund focuses on high dividend yield companies and aims to provide investors with exposure to companies that pay higher dividends than the broad emerging market indices. This fund has an expense ratio of 0.49% and holds around 100 stocks.
iShares MSCI USA Quality Dividend ESG ETF (QDUSA):
The iShares MSCI USA Quality Dividend ESG ETF (QDUSA) is designed to track the performance of U.S. large and mid-cap companies that have demonstrated strong quality and dividend characteristics, as well as positive environmental, social, and governance (ESG) characteristics. The fund has an expense ratio of 0.17% and holds around 100 stocks.
iShares UK Dividend ETF (IUKD):
The iShares UK Dividend ETF (IUKD) invests in UK companies that have a history of paying dividends. The fund aims to track the performance of the FTSE UK Dividend+ Index and provides exposure to companies that have a high dividend yield. The fund has an expense ratio of 0.40% and holds around 50 stocks.
SPDR S&P US Dividend Aristocrats ETF (SPYD):
The SPDR S&P US Dividend Aristocrats ETF (SPYW) is designed to track the S&P High Yield Dividend Aristocrats Index. This covers stocks of the S&P 500 composite 1500 index. This includes only companies that have increased their dividends for at least 20 consecutive years. The fund has an expense ratio of 0.35%.
iShares Euro Dividend ETF (IDVY):
The iShares Euro Dividend ETF (IDVY) invests in European companies that have a history of paying dividends. The fund aims to track the performance of the Dow Jones Euro STOXX Select Dividend 30 Index and provides exposure to companies that have a high dividend yield. The fund has an expense ratio of 0.40% and holds around 30 stocks.
SPDR S&P EURO Dividend Aristocrats ETF (EUDV):
The SPDR S&P EURO Dividend Aristocrats ETF (SPDR) is designed to track the performance of companies that are part of the S&P Euro High Yield Dividend Aristocrats Index. This index includes companies from the Eurozone that have increased or maintained their dividends for at least 10 consecutive years. The fund has an expense ratio of 0.30% and holds around 40 stocks.
VanEck Morningstar Developed Markets Dividend Leaders ETF (DNL):
The VanEck Morningstar Developed Markets Dividend Leaders ETF (DNL) is designed to track the performance of companies that are part of the Morningstar Developed Markets Dividend Leaders Index. This index includes companies from developed markets that have a history of paying dividends and have strong financials. The fund has an expense ratio of 0.29% and holds around 100 stocks.
Vanguard FTSE ALL World High Dividend Yield ETF (VHYL):
The Vanguard FTSE ALL World High Dividend Yield ETF (VHYL) provides exposure to high dividend yield companies across the world, including developed and emerging markets. The fund aims to track the performance of the FTSE All-World High Dividend Yield Index and has an expense ratio of 0.29%. The fund holds around 1,200 stocks.
[content
Conclusion: High Dividend Yield Funds
As you’ll have seen from the above, these high yield dividend funds can be helpful in a portfolio for several reasons. Firstly, they can provide a steady stream of income through dividend pay-outs. This can be especially useful during bear markets or when growth stocks are underperforming.
Secondly, they can provide diversification as they often invest in a range of companies from different sectors and geographies. Additionally, high yield dividend funds may have lower volatility compared to other types of funds. Especially those including volatile growth stocks. Lastly, they can be a good option for investors looking for a passive investment strategy as they offer exposure to a diversified portfolio of high-yielding stocks with low management fees.
Remember, these high yield dividend ETFs are available with the Lightyear app. Not only this but you can also invest specifically in high yield dividend stocks – commission free. This means that you can buy familiar stocks and earn dividends from the likes of Apple or Coca Cola.
When investing capital is at risk.
You might also be interested in:
Stocks & Shares ISA Platform Comparison
Beginner Investment Guide
Free Money Saving & Investing Apps – With Free Cash Offers
Summary
Article Name
High Dividend Yield Funds: 5 Funds That Make My Shortlist
Description
High dividend yield funds have become increasingly popular over the years. With the growth of passive investing, more investors are looking for a steady stream of income without having to spend a lot of time researching individual stocks. While dividend stocks can provide a steady stream of income, investing in them can be tricky and requires a high amount of research.
Author
Andrew
Publisher Name
Money Side Up
Publisher Logo
