Dividend ETFs as an Alternative to Bonds

As the economy recovers and more companies are hiking dividend payouts, income investors are finding dividend-paying stocks an attractive alternative to bonds. However, stocks can be riskier than bonds, so investors should seek to keep risk and cost under control.

According to Jonathan Burton’s Fund Track column, a search for funds that yield 2% or more and have below category-average expenses returns two ETFs.  The iShares Dow Jones Select Dividend Index (DVY) and WisdomTree SmallCap Dividend (DES) both have 30-Day SEC yields of 3.63%.

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