If your primary goals when investing are capturing a solid income stream and getting a decent yield on your money, then traditional debt instruments such as Treasury bonds, CDs and money market accounts haven’t been very kind to you of late. If you’re unsatisfied with the paltry platter of yield served up by the Fed, then you need to check out the menu of high-yield exchange-traded funds (ETFs). Here are 4 ETFs to satiate the appetite of hungry income investors.
iShares FTSE NAREIT Mortgage Plus Capped Index Fund (REM) seeks to track the price performance of the underlying holdings in the FTSE NAREIT All Mortgage Capped Index. REM has a dividend yield of 11.63%. REM is up 14.39% year to date. Top holdings include: (NLY) Annaly Capital Management Inc; (AGNC) American Capital Agency Corp; (CIM) Chimera Investment Corp; (MFA) MFA Financial Inc; and (STWD) Starwood Property Trust Inc.
PowerShares KBW High Dividend Yield Financial Portfolio (KBWD) seeks to track the price performance of the underlying holdings in the KBW Financial Sector Dividend Yield Index. KBWD has a dividend yield of 8.99%. REM is up 11.54% year to date. Top holdings include: (AGNC) American Capital Agency Corp; (IVR) Invesco Mortgage Capital Inc; (CIM) Chimera Investment Corp; (NLY) Annaly Capital Management Inc ; (MFA) MFA Financial Inc.
The investment objective of the Peritus High Yield ETF (HYLD) is to generate a high current income with a secondary goal of capital appreciation. HYLD is sub-advised by Peritus Asset Management, LLC. Peritus seeks to achieve the Fund’s objective by selecting a focused portfolio of high yield debt securities that, via their coupons, generate a high current income stream. HYLD has a dividend yield of 7.69%. REM is up 8.55% year to date.
Powershares CEF Income (PCEF) seeks investment results that generally correspond (before fees and expenses) to the price and yield of the S-Network Composite Closed-End Fund Index SM (the “underlying index”). The fund generally invests at least 90% of its total assets in securities of U.S.-listed closed-end funds that comprise the underlying index. It is a “fund of funds,” as it invests its assets in the common shares of funds included in the underlying index rather than in individual securities (the “underlying funds”). PCEF has a dividend yield of 8.18%. PCEF is up 7.05% year to date. Top holdings include: (EXG) Eaton Vance Tax-Managed Global Diversified Equity Income Fund; (ACG) AllianceBernstein Income Fund Inc; (EVW) Eaton Vance Ltd Duration Income Fund; (ETY) Eaton Vance Tax-Managed Diversified Equity Income Fund; (NFJ) NFJ Dividend Interest and Premium Strategy Fund.