Dividend ETFs Are The Flavor of the Month

In September it was municipal-bond exchange traded funds. This month it’s dividend-based ETFs. There’s a ton of them and some could be destined for an untimely demise, says Gary Gordon for ETF Expert.

For example, there are at least 12 large-cap, U.S. dividend ETFs. Do we really need this many? And let’s not forget the three similar high-yield dividend ETFs. However, within the giant heap of dividend ETFs, a couple stand out from the competition, according to Gordon. They are:

• iShares Dow Jones Dividend Fund (DVY) - This generates a reliable 3.3% of income by holding 100 of the highest dividend-yielding securities in the Dow Jones U.S. Total Market Index. Currently, it’s down 1.4% year-to-date.
• SPDR S&P Dividend (SDY) – SDY also offers 3.3% annually and pays out quarterly, tracking the S&P Dividend Aristocrat Index. Currently, it’s down 3.4% year-to-date.