While the Fed’s recent tapering of its quantitative easing programs will affect long-term bond yields, the central bank has pledged to keep short-term interest rates at near zero for quite some time. These are the interest rates that effect things like savings accounts, certificate of deposits and money market funds.
And with many of these traditional income instruments — along with most bonds — still not really paying enough to beat inflation, most investors looking for income have plowed headfirst into all sorts of real estate investment trusts (REITs), master limited partnerships (MLPs) and dividend paying stocks.
But what if those dividends still aren’t enough? Sometimes a measly 3% dividend yield isn’t going to cut it.
Luckily for investors, there are ways to “go for broke” when it comes to high dividend yields — namely, exchange-traded funds (ETFs). By using broad dividend ETFs, investors can realize diversification benefits and spread-out their bets in some pretty risky — and high-yielding sectors.
For investors seeking to add a hefty dividend yield to their portfolio, the following ETFs might just be up your alley.