When seeking a dividend ETF, there are some factors to look for. Broad diversification is important, or one that is holding companies that have stable dividend payouts.
Morningstar recommends Vanguard High Dividend Yield ETF (NYSEArca: VYM), which has $1.6 billion in assets. Holdings are from solid, large-cap companies such as Exxon Mobile (NYSE: XOM) and Microsoft (NYSE: MSFT). VYM has a yield of 3.3%. SPDR S&P Dividend ETF (NYSEArca: SDY) has about $5.95 billion in assets. Top holdings are Pitney Bowes (NYSE: PBI) and HCP Inc (NYSE: HCP). SDY yields 3.4%.
Vanguard High Dividend Yield ETF
Tisha Guerrero contributed to this article.