Money manager Marvin Appel lays out his case for dividend paying ETFs in a recent issue of Investment News.
In the article Reaping high dividend income with ETFs, Appel recommends using ETFs over mutual funds due to lower expenses. He also suggests combining a US focused dividend fund such as the SPDR S&P Dividend ETF (SDY) in combination with an emerging market dividend fund like the WisdomTree Emerging Market High Yielding Equity Fund (DEM).
According to Appel’s analysis, a portfolio of dividend ETFs made up of 80% US and 20% Emerging Markets would have performed better with less risk than portfolios focused 100% on either category.
According to company websites, DEM has a distribution yield of 6.1% and 30 day SEC yield of 10.4%. SDY has a dividend yield of 5.65%.