Tech Stocks for Retirement: First Trust NASDAQ Technology Dividend ETF (TDIV)
Expense Ratio: 0.5%, or $50 per $10,000 invested.
While holding broad ETFs that focus on tech stocks, like the Technology Select Sector SPDR Fund (NYSEARCA:XLK), can net investors higher dividend yields than during the dotcom days, they aren’t anything to write home about. But the 3% 30-day SEC yield of the First Trust exchange Traded Fd VI (NASDAQ:TDIV) is.
TDIV is the only ETF to specifically hone in on tech stock dividends. The fund tracks an index of tech stocks that have paid a regular or common dividend within the past 12 months, yield at least 0.5% and have not decreased their dividends over the last 12 months. That’s currently 88 different firms. Top holdings include Microsoft Corporation (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL) and Broadcom Ltd (NASDAQ:AVGO).
This focus on steady, dividend-paying firms within the tech sector provides TDIV with that relatively juicy 3% SEC yield.
As for TDIV’s returns, since the fund’s inception in August of 2012, it has managed to produce 12.6%. That’s slightly lower than the performance of the XLK. However, the difference in the two comes down to the inclusion of additional names like Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) in the SPDR. Meanwhile, TDIV’s ride has been a heck of a lot smoother.
In the end, when it comes to tech stocks for retirement investors, TDIV is the ETF to buy.