International Dividend ETFs Yielding 6%

Investors on the prowl for income might want to consider dividend ETFs for international markets that are yielding 6% or more.

“Even though the yield on the 10-year Treasury bond has fallen from its near 3% level this week, many overseas securities still yield far more than 3%, making them potentially appealing for U.S. income seeking investors,” said Todd Rosenbluth, S&P Capital IQ Director of ETF Research, in a recent note.

ETFs in the international dividend category include First Trust Dow Jones Global Select Dividend Index Fund (FGD).

“Among the numerous benefits of ETFs is that they offer exposure to a wide range of stocks with a common investment theme and at a low cost. Of course not all holdings of dividend ETFs will be the same, since they seek to track different indices, and as such, the ETFs will have different country and sector exposures,” Rosenbluth wrote.

FGD, sponsored by First Trust, was paying a 30-day SEC yield of 6.38% at the end of August.

First Trust Dow Jones Global Select Dividend ETF seeks to track a Dow Jones developed market index that is constructed using companies that have provided relatively high dividend yields. For inclusion, a company must have increased its dividend compared to its last three year average and there’s also a focus on the company’s dividend payout ratio. FGD has an above-average 12-month yield of 5.0%, and while it has 19% of its assets in U.S stocks, companies domiciled in Australia, United Kingdom, France and Canada are also well represented. From a sector exposure perspective, Telecom Services, Industrials, and Financials stocks have the largest weightings.

Source:  John Spence, ETF Trends

First Trust Dow Jones Global Select Dividend Index Fund (FGD).is a component of the D2 Capital Management Multi-Asset Income Portfolio.

The information contained in this article does not constitute a recommendation, solicitation, or offer by D2 Capital Management, LLC or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service. D2, its clients, and its employees may or may not own any of the securities (or their derivatives) mentioned in this article.

 

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