This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Top 10 Dividend ETFs

Stocks in this article: XLU DVY VIG IYR RWX PID VYM

This posting features a comprehensive review of the dividend-related ETF sector. There are more than three dozen ETFs issued (including Elements not covered here) with more on the way to evaluate in this sector. To simplify matters for investors, we've whittled choices down to 10. The issues chosen represent a broad cross-section of domestic, global, overseas, real estate (REITs) and other sectors from a variety of sponsors. Doing so, makes sorting through the sector more manageable for most investors. We're not necessarily recommending one issue over another; rather we're just trying to feature those issues that aren't repetitive, although we mention other choices within each brief review where applicable.

Within each category, we filter them by placing importance on high assets under management, liquidity and/or strategies that make a difference the most critical tests. Newer issues tied to new indices with long (more than five years) of historical data may be worth investigating, featuring and using as a replacement if necessary.

As demographics in the developed world change with aging populations, the demand for income increases while risk avoidance decreases. At the same time, many investors understand the need for growth continues given the potential for inflation. Keeping a portion of a portfolio in common stocks among other sector allocations is important; however, adding yield through dividends can help achieve the dual goal.

Remember, with higher dividend yields, the more likely risk-taking increases -- there's no free lunch as they say.

XLU (SPDR Utilities Sector ETF) follows the Utilities Select Sector Index. This sector remains the historical first choice for investors seeking stable dividend income with the potential for long-term growth in value and increases in dividends. It was launched with a series of other S&P 500 sectors in June 2011. AUM (Assets under Management) exceeds $4.5 billion and average daily trading volume is roughly 6.3M shares. The expense ratio is .20% while the current quarterly dividend is $.30. The current yield is 3.60% and as of June 2011 YTD performance 8.99%.

Data as of June 2011

XLU Top Ten Holdings & Weightings

  1. The Southern Company (SO):                                     8.30%
  2. Dominion Resources, Inc. (D):                        6.79%
  3. Exelon Corp (EXC):                                         6.78%
  4. NextEra Energy, Inc. (NEE):                            5.97%
  5. Duke Energy Corp (DUK):                              5.63%
  6. FirstEnergy Corp (FE):                                    4.57%
  7. American Electric Power  (AEP):                      4.52%
  8. PG & E Corporation (PCG):                            4.23%
  9. Public Service Enterprise Group (PEG):          4.15%
  10. PPL Corp (PPL):                                              3.91%

DVY (Dow Jones Select Dividend ETF) was the first ETF launched in November 2003 with a focus on dividends. It follows the index of the same name. AUM is over $6 billion and average daily trading volume exceeds 660K shares. The expense ratio equals .40% and the current quarterly dividend is $.47 meaning a current yield as of June 2011 3.6%. Given the variety of companies comprising the index dividends can vary more than with utilities for example. Through March 2011 DVY has returned 5.57%.

Competitive issues could include DTD (Wisdom Tree Total Dividend Fund) and FDL (First Trust Morningstar Dividend Leader Index ETF)

Data as of June 2011

DVY Top Ten Holdings & Weightings

  1. Lorillard, Inc. (LO):                               4.06%
  2. Chevron Corporation (CVX):                2.20%
  3. Entergy Corp (ETR):                            2.04%
  4. VF Corporation (VFC):                                     1.85%
  5. Integrys Energy Group Inc (TEG):       1.85%
  6. Kimberly-Clark Corporation (KMB):      1.84%
  7. CenturyLink, Inc. (CTL):                      1.79%
  8. FirstEnergy Corp (FE):                        1.74%
  9. McDonald's Corporation (MCD):          1.62%
  10. DTE Energy Holding (DTE):                1.60%

1 of 3

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs