Investing in FDVV, SCHD, VOO and VYM ETFs Today Could Secure Your Financial Future

Key Points

Here are four high-yield ETFs that can generate steady income and capital appreciation.
The yield, low-risk, low-cost and the right mix of holdings make the ETFs ideal for the long-term.
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We’re all trying to make money, and by investing in the market, all of us want to generate higher returns and take home big gains. With thousands of stocks in the market, it can become overwhelming to pick a few. However, if you’re not interested in researching and tracking your portfolio, consider investing in exchange-traded funds (ETFs). They are highly diversified, low-cost, and generate steady returns.

There are all kinds of ETFs available in the market, and they track different indexes. Based on your investment criteria, you can pick the ones that can offer growth or dividends, or a mix of both. In today’s challenging market, ETFs can make a significant difference to your portfolio. If you’re looking for ETFs to secure your financial future, here are a few of my top picks.

ETF	Yield	Expense Ratio
Schwab U.S. Dividend Equity ETF	3.9%	0.06%
Vanguard S&P 500 ETF	1.17%	0.03%
Vanguard High Dividend Yield Index ETF	2.57%	0.06%
Fidelity High Dividend ETF	3.04%	0.16%

Schwab U.S. Dividend Equity ETF

The Schwab U.S. Dividend Equity ETF (NYSEARCA:SCHD) tracks the Dow Jones U.S. Dividend 100 index and provides exposure to the best high-yield dividend stocks. The fund invests in companies that have a history of growing dividends and holds 103 stocks based on various qualities.

Some of the top 10 holdings include Verizon Communications, AbbVie, Chevron, and PepsiCo. These are strong dividend-paying companies that haven’t slashed dividends despite market ups and downs.

SCHD has an impressive yield of 3.9% and an expense ratio of 0.06%, which means you get to keep more of your dividend income SCHD generates. The fund invests in energy (19.23%), consumer staples (18.81%), healthcare (15.53%), and industrials (12.50%).

Its top 10 holdings make up 41% of the fund, and it should deliver price appreciation as the underlying companies grow. Each of the top 10 companies have a solid history of increasing dividends and steadily rewarding investors even in times of market uncertainty, making SCHD an ETF to hold for the long-term.

Vanguard S&P 500 ETF

The Vanguard S&P 500 ETF (NYSE: VOO) is a strong fund created by Vanguard that follows the S&P 500 index. Available at an expense ratio of 0.03%, the fund is one of the largest and most popular ETFs today.

VOO offers the perfect blend of low cost and large size. If you want to diversify and invest in the broader S&P index, consider VOO. It holds the top 500 stocks and has a dividend yield of 1.17%. The annual dividend is $6.93 with steady capital appreciation. All the Dividend Aristocrats are S&P 500 members; thus, VOO has exposure to all of them, while the top 10 holdings are the Magnificent Seven.

In addition to that, the fund also holds some of the top tech companies, such as Tesla and Netflix, which do not pay dividends but show capital growth. VOO has the highest allocation in information technology (34.10%), financials (13.60%), consumer discretionary (10.40%), and communication services (9.90%).

Vanguard High Dividend Yield Index ETF

A popular dividend ETF for passive income, the Vanguard High Dividend Yield Index Fund ETF (NYSEARCA:VYM) is ideal for income investors. It has about $75 billion in assets and tracks the performance of the FTSE High Dividend Yield Index. The fund buys high-yield stocks and holds about 580 stocks, more than those included in the S&P 500 index.

It ensures wide diversification and low weightage on a single stock. VYM considers only the yield to include the stock in the fund, and it picks the companies that have the highest yield. This ensures steady, passive income at low risk. The fund has a yield of 2.57% and an expense ratio of 0.06%.

Its highest allocation is in the financial sector (21.60%), followed by industrials (13.60%), technology (12.30%), and healthcare (11.60%). If you do not want to put all your money in tech stocks or tech-focused ETFs, VYM can be a good choice.

Its top 10 holdings include some of the strongest dividend payers such as Walmart, Exxon Mobil, Procter & Gamble, and Chevron. Besides paying steady dividends, these companies have also shown capital growth over the years, making VYM a solid bet to secure your financial future.

Fidelity High Dividend ETF

The Fidelity High Dividend ETF (NYSEARCA:FDVV) is another top choice for passive income investors. The fund has net assets worth $6.19 billion and an expense ratio of 0.16%. It tracks the Fidelity High Dividend Index and invests 80% of the assets in the index. The ETF only invests in dividend payers and companies that are expected to keep their dividends growing. It has 123 holdings, and the top ten make up about 33% of the fund.

FDVV invests 26.03% in technology, 19.08% in financial services, 12.60% in consumer defensive, and 11.27% in real estate. The fund has a yield of 3.04% and has offered impressive capital appreciation.

Its top 10 holdings include Nvidia, Visa, Coca-Cola, and Broadcom. Looking deeper, you’ll also see big banks, oil giants, and undervalued consumer staple stocks that enjoy hefty yields. In the last five years, FDVV has outperformed the three major indexes. While it doesn’t have an eye-popping yield, the ETF offers the perfect blend of growth and income. After gaining 9.62% year-to-date, FDVV is on an upward spree.

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Author: Vandita Jadeja

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