The perfect product for investors looking to generate above-average income via ETFs. The trade alerts and ongoing research will guide you to build an income portfolio paying out monthly dividends. A great fit for investors of all risk levels.
There are many reasons but the most important is diversification. By investing in an ETF such as the iShares High Dividend Equity ETF (HDV) you get exposure to 75 stocks that come from 10 different sectors. The yield remains well above average at 3.4% and the risk is substantially lower than owning an individual stock.
At the end of the day each investment decision comes down to reward versus risk. And ETFs will almost always come out on top.
Yes. Even in the current low interest rate world there are ETFs that offer yields well above 6% and the mix that we will share with subscribers is currently yielding over 6%. Keep in mind over time there will be fluctuations in the yield as ETFs are replaced and new ETFs added. The dividends will also vary from month to month, however the long-term goal of 6% annually is very attainable.
A benefit of the growing world of ETFs has been the expansion into areas that were not available to the average investor in the past. This will allow us to invest in ETFs that are made up of stocks, bonds, MLPs, preferred stocks, currencies, individual countries around the world, and niche sectors. In other words, we are open to consider all income ETFs as long as they meet our goals and risk tolerance.
The ETFs we recommend can be bought in both taxable and tax-deferred accounts. Typically a tax-deferred account (IRA, Roth IRA, IRA Rollover, 401K, etc.) will be the best option or income ETFs because there will not be a tax liability on the dividends paid in the current tax year. **This is generally speaking and all investors have different situations and therefore should consult a tax advisor to discuss their individual tax situation.
Yes. Just like all ETFs and stocks, the income ETFs will also move in price on a daily basis. The majority will have low betas (measure of volatility) compared to the overall market. For example, the iShares High Dividend Equity ETF (HDV) trades with a beta of 0.58, nearly half of that of the S&P 500, suggesting less movement on a daily basis.
Because the goal is income first and capital appreciation second, the daily movements therefore will be below average.
