3 High-Yield Dividend ETFs to Buy for Passive Income

In the ever-evolving world of investing, it's essential to adapt and find new ways to generate income. One such approach is investing in high-yield dividend ETFs, which can provide a steady stream of passive income while minimizing risk. Here are three high-yield dividend ETFs to consider for your portfolio:



1. Global X Alternative Income ETF (ALTY)
- Trailing Dividend Yield: 7.3%
- Assets Under Management: $34 million
- Expense Ratio: Not provided
- ALTY invests in a range of alternative securities, including master limited partnerships, business development companies, preferred stock, emerging market bonds, and call options. This diversified approach provides a high, sustained dividend income, making it an attractive option for income-oriented investors. However, it's important to note that this fund may have higher volatility due to its focus on alternative investments.

2. SPDR Portfolio S&P 500 High Dividend ETF (SPYD)
- Trailing Dividend Yield: 4.4%
- Assets Under Management: $6.9 billion
- Expense Ratio: Not provided
- SPYD is an index fund based on the S&P 500 High Dividend Index, which consists of the 80 highest-yielding stocks in the S&P 500. By focusing on high-dividend stocks, SPYD may have a higher yield than the broader market. However, it's essential to consider the risks associated with these higher-yielding stocks, such as sensitivity to interest rate changes and potential volatility during market downturns.

3. ALPS Sector Dividend Dogs ETF (SDOG)
- Trailing Dividend Yield: 3.91%
- Assets Under Management: $1.1 billion
- Expense Ratio: 0.35%
- SDOG seeks out the top-five-yielding stocks in each of the S&P 500 sectors, excluding REITs. This sector-specific approach can provide a higher yield and a built-in contrarian nature, as it gives sectors equal billing and steps away from what has worked in the previous years. However, this focus on high-yielding stocks within specific sectors may lead to higher volatility and sector-specific risks.

In conclusion, high-yield dividend ETFs can be an excellent addition to your portfolio, providing a steady stream of passive income while minimizing risk. By considering funds like ALTY, SPYD, and SDOG, you can diversify your income sources and better prepare for market fluctuations. Always remember to do your own research and consider your risk tolerance before making any investment decisions.