There are all kinds of EFTs in the market but finding the best and also something that gives high dividend is the key. While many investors can fixate on share price, dividends are an important part of any long term investment strategy. Whatever your investing needs are, there’s definitely a place for best paying dividend ETFs, in your portfolio.
EFTs can offer a much needed stream of income in retirement that prevents the need to sell off assets. In a challenging market environment like the current one, ETFs can help eliminate the risk of owning an individual stock. Also because they tend to be less volatile than individual stocks. Although, they’re similar in principle to mutual funds, they’re easier to buy and trade than the typical mutual fund, and they tend to have lower fees.
Listed are the 7 best high paying dividend ETFs to buy now:
Vanguard Dividend Appreciation ETF (VIG)
One of the largest ETFs of any kind as measured by assets, the nearly $69 billion Vanguard Dividend Appreciation ETF offers diversified exposure to large dividend paying stocks in the U.S. The fund comprises more than 300 companies, led by Microsoft Corp. (MSFT), Apple Inc. (AAPL), UnitedHealth Group Inc. (UNH) and Exxon Mobil Corp. (XOM). As these 4 big stocks represent about 16% of the portfolio by themselves it makes VIG a bit top heavy, and it also keeps the dividends in check considering that both Apple and Microsoft currently yield less than 1%.
Global X SuperDividend ETF (SDIV)
SDIV which prioritizing payouts, regardless of company size or geography is also worth investing in as it is the highest yielding dividend EFT. This $760 million fund holds 104 handpicked stocks for a more focused list of holdings. About 32% of its assets are in real estate, materials companies is second with almost 19%. It’s international, with only about 31% of assets in the U.S. There’s clearly more risk with this kind of targeted approach, but if you’re after the biggest possible yield, SDIV may be worth a look despite its more aggressive nature.
JPMorgan Equity Premium Income ETF (JEPI)
Another high yielder, JEPI boasts an 11.5% trailing 12 month yield. It has a smaller portfolio of 135 names with about 15.3% of its $26.8 billion assets in the top 10 names, including Adobe Inc. (ADBE), Microsoft, Amazon.com Inc. (AMZN) and Hershey Co. (HSY). While JEPI’s expense ratio is a reasonable 0.35%, it has a high turnover of 195%, which can add to overall costs of the fund.
ProShares S&P 500 Aristocrats (NOBL)
NOBL offers, via a portfolio of more than 65 “dividend aristocrats” from the S&P 500 that have increased their dividend payouts for 25 consecutive years or more. The dividends aren’t always impressive from a yield perspective, of course, with a current 30 day SEC yield of only 2%, but you do have the potential for future growth in those paydays with NOBL.
Vanguard International High Dividend Yield ETF (VYMI)
VYMI offers a yield of 4.6% thanks to a focus on high yield opportunities outside the U.S. Right now, Japan leads the portfolio’s allocations at around 13.5% of holdings, followed by the UK at 11.8% and Australia at just under 8%. Multinationals such as Dutch oil giant Shell PLC (SHEL) and Japanese automaker Toyota Motor Corp. (TM). If you want a bit more yield with some geographic diversification, this Vanguard fund is a good fit.
Global X U.S. Preferred ETF (PFFD)
PFFD invests in preferred stocks in the U.S. to generate a 12-month yield of 6.6%. It pays distributions monthly and costs only 0.23%, making it a great pick for income investors.
Franklin U.S. Low Volatility High Dividend Index ETF (LVHD)
If you’re looking for yield but don’t want to take on a ton of risk, then this low volatility offering may be worth considering. The payout is currently about 3.5%. The result is a selective list of 125 companies built for dividends and stability that include software giant Cisco Systems Inc. (CSCO) and health care icon Jonson & Johnson (JNJ), among others.
