Where to Find Yield in ETFs
August 29th 2012 at 12:13pm by John Spence
Investors can find yield in ETFs tracking real estate, closed-end funds, dividend stocks and preferred shares with funds that are throwing off income of more than 6%.
“Low yields on Treasuries and high-quality bonds are pushing income investors to take on more risk in search of yield,” writes Russ Krull at The Motley Fool.
“A number of high-yielding exchange traded funds are cranking out juicy yields and a little digging into the fund assets will shed some light on the risks involved,” Krull said. [Dividend ETFs: Look Before You Leap]
Based on current ETF yields, asset classes with some of the highest current yields are mortgage REITS, closed-end funds, international stocks and preferred stocks. [Mortgage REIT ETFs Yielding Over 10%]
An ETF comprised of closed-end funds is an alternative for income-seeking investors. PowerShares CEF Income Composite (NYSEArca: PCEF) gives investors the best of both worlds–the simplicity of an ETF with the yield of a basket of CEFs. [Consider this ETF for Steady Income]
In preferred stock ETFs, PowerShares Preferred Portfolio (NYSEArca: PGX) and PowerShares Financial Preferred Portfolio (NYSEArca: PGF) are yielding more than 6%. [What is an ETF? — Part 21: Preferred Stocks]
In dividend ETFs, SPDR S&P International Dividend (NYSEArca: DWX) offers a yield of nearly 7%. [International Dividend ETFs]
The table below from The Motley Fool lists the five highest-yielding ETFs with more than $300 million in assets:
The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.