Many investors are using dividend ETFs as a way to dip a toe in the stock market with a more conservative strategy and income to boot. News over the weekend from Cyprus is a reminder of the macro risks still lingering in the market.

For instance, the SPDR S&P Dividend ETF (NYSEArca: SDY) has generated attractive risk-adjusted returns, writes Jordan Wathen for The Motley Fool. The ETF is beating the S&P 500 by almost 3% so far this year. Additionally, SDY comes with a decent 3.0% dividend yield. [An ETF that Tracks Consistent Dividend Payers]

The ETF tracks the popular Dividend Aristocrats Index and is comprised of about 86 companies that generated consistent profits, earnings quality and dividend payments. Currently, the ETF is trading at a relative premium to the S&P 500, with a forward earnings multiple of 15.59 compared to the 13.77 of the SPDR S&P 500 ETF (NYSEArca: SPY). [Buyback, Dividend ETFs Boosted as Companies Return Record Cash]

Over the past five years, SDY has cranked out 47% total returns compared to the S&P 500 Index. Additionally, the ETF has generated 50% more dividends than the S&P 500 each year.

If more bond investors swap into equities, most will likely prefer high-yield dividend options, like the Dividend Achievers Index. Moreover, the Dividend Achiever components, with their consistent dividend track record, would provide a backstop for any potential dips in the market.

For more information on dividend funds, visit our dividend ETFs category.

Max Chen contributed to this article.

Full disclosure: Tom Lydon’s clients own SPY.

The opinions and forecasts expressed herein are solely those of Tom Lydon, 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.