S&P's Best Dividend ETF Picks | ETF Trends

Investors’ hunger for yield has caused many to sniff around dividend exchange traded funds to boost income in their portfolios.

“With interest rates relatively low, we believe that many investors are increasingly starved for income. As a result, we think more attention has been given to dividend-yielding stocks,” said S&P Capital IQ Equity Analyst Tom Graves in a research note.

ETFs can add diversification to the mix — they typically own a basket of stocks, fixed-income securities or other types of financial holdings, Graves wrote. [Dividend ETFs Without the Label]

According to S&P Capital IQ Equity Research, 13 ETFs stood out and are singled out as “overweight” from the 74 non-sector higher-yielding ETPs categorized with 12-month trailing yields of 3.0% or more. Among the 13, seven are international and the other six are U.S. domestic.

The iShares MSCI EAFE Index (NYSEArca: EFA) is the largest of the recommended funds, at $36 billion in assets, and the BLDRS Europe 100 ADR Index (NYSEArca: ADRU) is the smallest at $17 million.

Vanguard Europe ETF (NYSEArca: VGK) has the highest dividend yield, with a trailing 12-month yield of 5.65%. The iShares MSCI EAFE Value Index (NYSEArca: EFV) and WisdomTree Equity Income (NYSEArca: DHS) also have trailing 12-month yields of more than 4.0%.

WisdomTree Equity Income (NYSEArca: DHS), Vanguard High Dividend Yield Indx ETF (NYSEArca: VYM), WisdomTree LargeCap Dividend (NYSEArca: DLN), WisdomTree Total Dividend (NYSEArca: DTD) and SPDR S&P Dividend (NYSEArca: SDY) outperformed the S&P 500.