Investing in dividend exchange-traded funds (ETFs) can be an easy way to earn passive income on a relatively risk-adjusted basis. During recessions, blue chip dividend stocks with strong fundamentals tend to do well relative to growth investments.
Another relatively safe investment is US Treasury yields, which will most likely continue to rise throughout the year as the Fed has two meetings left. The Fed may raise interest rates at its November and December meetings as it has not seen inflation come down at a sustained pace.
These three ETFs have been down since the start of the year, but could offer an attractive buy to hedge against inflation and a looming recession.
See also: Bad omen? Every time a Philadelphia baseball team wins the World Series, there’s a severe recession
Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares TVIP has an estimated dividend of $3.034 or per share per year with a yield of 6.35%, makes quarterly payments, with an infrequent history of increasing its dividends.
Vanguard Short-Term Inflation ETF seeks to track the performance of the Bloomberg US Treasury Inflation-Protected Securities (TIPS) 0-5 Year Index.
The fund has been designed to generate returns more closely correlated to realized inflation in the short term and to offer investors the potential for lower volatility of returns compared to a longer duration TIPS fund.
Global X Funds S&P 500 ETF Covered Call XYLD has an estimated dividend of $5.21 per share per year with a yield of 13.09%, making monthly payments, with a history of paying its dividends for nine years.
Global X Funds ETF follows a “buy-sell” strategy, in which the fund buys the stocks of the S&P 500 index and “sells” or “sells” the corresponding call options on the same index.
The top three Global X fund holdings include Apple Inc. AAPL, Microsoft Corporation MSFT and Amazon.com, Inc. AMZN.
Amplify CWP Enhanced Dividend Income ETF DIVO has an estimated dividend of $1.73 per share per year and a dividend yield of 4.97%, through monthly payments, with a history of increasing its dividend once in the past year.
The top three holdings of Amplify CWP ETFs include Chevron Corporation CLC, UnitedHealth Group Inc. A H, McDonald’s Corporation MCD
DIVO is an actively managed ETF comprised of high-quality, large-cap companies with a history of dividend growth, as well as a hedged tactical buy strategy on individual stocks.
The estimated dividend is usually calculated by annualizing the most recent distribution first, then dividing it by the most recent closing price. Estimated dividend rates were calculated from Fidelity.
What about other companies’ dividends? Click here to view Benzinga’s dividend schedule.
Photo: Funtap via Shutterstock
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