Key Points
-
If you’re looking for an investment that pays monthly dividends, consider dividend ETFs.
-
SPHD offers a high yield, monthly dividends and has a strong portfolio, all at a lower-cost than SCHD.
-
Are you ahead, or behind on retirement? SmartAsset’s free tool can match you with a financial advisor in minutes to help you answer that today. Each advisor has been carefully vetted, and must act in your best interests. Don’t waste another minute; learn more here.(Sponsor)
All of us could use a little more monthly income; it’s not just for retired folks anymore. Considering the state of the economy and the rising household expenses, the idea of receiving a monthly dividend income is attractive. If you’re constantly worried about the ebbs and flows of the market, investing in an exchange-traded fund can be a smart choice.
You can benefit from capital appreciation while enjoying steady passive income, at low risk. Stocks will pay you a quarterly dividend, while bonds will pay every six months, but ETFs can generate monthly income to cover your expenses or to reinvest.
Getting paid 12 times a year means you enjoy a higher income and can budget for your expenses accordingly. If you’re looking for dividend ETFs that pay monthly, move over the Schwab U.S. Dividend Equity ETF (
The fund
Invesco S&P 500 High Dividend Low Volatility was launched in 2012. It has a simple method where in large and financially stable companies are chosen from the S&P 500, and it then narrows it down to companies with the highest yield. This leads to a heavy concentration in utilities and REITs. The stocks in the fund carry equal weight, so each investment has the same impact on performance. Since there’s no extra weightage on any stock, it reduces the risk and volatility.
The ETF has added about 2.77% so far this year and 1.66% in 12 months. It has an NAV of $49.70, and the 52-week low and high are $43.40 and $51.88. The fund has $3.2 billion in assets under management.
The performance
SPHD has a dividend yield of 4.57% and $10,000 invested in the fund in 2015 would be worth $22,485 as of June 2025. Compared to SCHD, which has a yield of 3.78%, SPHD offers a higher return.
It has an expense ratio of 0.30%, which is lower than SCHD’s 0.060%. SPHD is all about the S&P 500 index and holds the 52 best stocks out of the 500. These are the least volatile and high-yield stocks within the index.
SPHD ensures the right risk-return balance, and its dividend yield is more than three times that of the S&P 500. It is a fund that doesn’t invest in the tech sector. Hence, if you already own the Magnificent Seven or aren’t keen on the tech industry, this is an ideal income ETF for you.
Its sector allocation is as follows:
- Real estate: 22.82%
- Consumer staples: 17.88%
- Utilities: 13.65%
- Healthcare: 11.42%
SCHD doesn’t have any exposure to REITs and very limited exposure to utilities. These gaps are filled by SPHD. It has the highest allocation to the real estate sector, allowing investors to participate in the real estate industry without a large capital.
It has generated total returns of 6.21% in a year, 7.09% in 3 years and 12.41% in five years.
Low-risk, high reward
About 40% of the fund is invested in mid-cap stocks, followed by 29% in large-cap and 13% in small-cap stocks. The top 10 holdings are a perfect mix of strong, dividend-paying companies such as Verizon Communications, Pfizer, Altria Group Inc., United Parcel Service, Realty Income Corp, and Alexandria Real Estate Equities Inc. The top 10 constitute 26% of the portfolio.
SPHD pays a monthly dividend, and its recent dividend was $0.161. The annual payout is $1.71, and the ETF has reported 12 consecutive years of dividend payments.
You can sleep well with the Invesco S&P 500 High Dividend Low Volatility ETF in your portfolio.
The post Forget SCHD, This Dividend ETF Pays Monthly appeared first on 24/7 Wall St..
