Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

5 High Yield, Low Volatility ETF Plays

Tue, Nov 20, 9:15 AM ET, by Michael Johnston

Of course, many high yielding asset classes come with considerable risk, and considering only the return opportunity could be a foolish move in the current environment. To put all the high yielding opportunities out there on equal footing, we compared both distribution yield over the past 12 months and volatility during the past 200 trading days — rough approximations for return and risk profiles [Download How to Pick The Right ETF Every Time].

Specifically, we:

  1. Took approximately 80 ETFs (and ETNs) from high yielding asset classes, including dividend paying stocks, junk bonds, MLPs, and preferred stocks
  2. Used the ETF Analyzer to generate 12 month dividend yield and 200 day volatility for each
  3. Calculated dividend yield as a percentage of volatility–basically, the yield offered relative to the risk incurred

The results were all over the board, as can be expected in a somewhat turbulent environment (it should be noted that these figures change daily, and are inherently backward looking). But some interesting trends emerged from this analysis, highlighting a few ETFs that offer up attractive yields relative to the volatility (i.e., risk) they come with [see also Monthly Dividend ETFdb Portfolio].

1. SPDR Wells Fargo Preferred Stock ETF (PSK)

Preferred stock jumped out as the clear winners from this exercise; these securities don’t offer the highest yields out there by any measure, but they make relatively attractive payouts without exposing investors to significant volatility. In terms of getting the most dividend bang for your volatility buck, preferred stock ETFs stand head and shoulders above the competition right now [see Hunt For Yield: How Do All The High-Yielding ETFs Stack Up].

PSK isn’t the most popular preferred stock ETF, but stands out as an opportunity with a meaty yield with limited downside:

  • 12-Month Dividend Yield: 6.4%
  • 200 Day Volatility: 3.8%
  • YTD Return: 12.7%

There are a handful of additional preferred stock ETFs making attractive payouts with very low volatility now, including PFF and PGX.

2. PowerShares High Dividend Yield Financial Portfolio (KBWD)

You may be surprised to see a financial ETF on this list given the reputation for volatility in this sector. But KBWD has been producing pretty solid returns and offering up a hefty dividend yield while exhibiting relatively low volatility recently [see Financials Free ETFdb Portfolio].

  • 12-Month Dividend Yield: 10.9%
  • 200 Day Volatility: 12.6%
  • YTD Return: 9.8%

3. iShares FTSE NAREIT Mortgage REITs Index Fund (REM)

Mortgage REITs can be extremely risky propositions, given their use of leverage to achieve exposure to mortgages. But this corner of the REIT market offers a huge yield in the current environment, and has been able to do so without experiencing significant volatility.

  • 12-Month Dividend Yield: 10.6%
  • 200 Day Volatility: 15.1%
  • YTD Return: 20.0%

Market Vectors offers a similar ETF, MORT, that has similarly produced a solid dividend yield with relatively low volatility recently.

4. Global X SuperDividend ETF (SDIV)

For investors looking to pick out the highest yielding stocks from around the globe, SDIV could be an interesting option. The underlying portfolio consists of 100 high yielding stocks, each weighted at 1%. The result is a high basket with an aggregate distribution yield in the neighborhood of 8%. Though this approach has the potential to expose investors to more speculative companies, the risk has been relatively low over the past year given the hefty yield opportunity [see also Inside The SuperDividend ETF: Q&A With Bruno del Ama].

  • 12-Month Dividend Yield: 7.8%
  • 200 Day Volatility: 12.7%
  • YTD Return: 8.1%

5. Cushing MLP High Income Index ETN (MLPY)

It’s probably no surprise that MLPs are on this list; these energy-related entities are a source of attractive payouts thanks to unique tax incentives, and maintain relatively stable operations that limit volatility (though they endured a steep post-election sell-off). There are a handful of MLP ETFs and ETNs available (the distinction is an important one in this case) that offer yields in excess of 6%–a pretty good haul right now. MLPY, as the name suggests, offers one of the higher payout ratios among MLPs. And it manages to do so without an overwhelming amount of risk [see our Energy Bull ETFdb Portfolio].

  • 12-Month Dividend Yield: 7.9%
  • 200 Day Volatility: 13.2%
  • YTD Return: 0.7%

[For more ETF analysis, make sure to sign up for our free ETF newsletter or try a free seven day trial to ETFdb Pro]

Disclosure: No positions at time of writing.


SDI Glossary: "Dividend" Definition
SDI Glossary: "ETFs" Definition
SDI Glossary: "iShares" Definition
SDI Glossary: "Mortgage REIT" Definition
SDI Glossary: "Stock" Definition
SDI Glossary: "Yield" Definition
This Article's Word Cloud:   Dividend   ETFdb   ETFs   ETNs   High   KBWD   MLPs   Month   Portfolio   Preferred   Return   There   Volatility   Yield   attractive   been   dividend   environment   from   given   high   including   interesting   investors   list   offer   offers   opportunity   over   past   payouts   preferred   pretty   recently   relatively   risk   solid   stock   stocks   that   there   these   they   this   volatility   with   without   yield   yielding   yields

| More

SEA Crowded With Sellers
Mon, Jul 6, 4:24 PM ET, by ETF Channel

In trading on Monday, shares of the Guggenheim Shipping ETF (SEA) entered into oversold territory, ...

IPF Makes Notable Cross Below Critical Moving Average
Mon, Jul 6, 4:24 PM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P International Financial Sector ETF (IPF) crossed ...

First Trust China AlphaDEX Fund (FCA) Shares Cross Below 200 DMA
Mon, Jul 6, 4:24 PM ET, by ETF Channel

In trading on Monday, shares of the First Trust China AlphaDEX Fund ETF (FCA) crossed ...

IPD Makes Notable Cross Below Critical Moving Average
Mon, Jul 6, 4:24 PM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P International Consumer Discretionary Sector ETF (IPD) ...

Shares of EEML Now Oversold
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the iShares MSCI Emerging Markets Latin America ETF (EEML) ...

EWC Crowded With Sellers
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the iShares MSCI Canada ETF (EWC) entered into oversold ...

SPDR S&P Emerging Asia Pacific (GMF) Enters Oversold Territory
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P Emerging Asia Pacific ETF (GMF) entered ...

DFE Crosses Critical Technical Indicator
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the WisdomTree Europe SmallCap Dividend Fund ETF (DFE) entered ...

XSD Crosses Critical Technical Indicator
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P Semiconductor ETF (XSD) entered into oversold ...

iShares Commodities Select Strategy Getting Very Oversold
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the iShares Commodities Select Strategy ETF (COMT) entered into ...

XLB Crosses Critical Technical Indicator
Mon, Jul 6, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the Materials Select Sector SPDR Fund ETF (XLB) entered ...

Shares of FONE Now Oversold
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the First Trust NASDAQ CEA Smartphone Index Fund ETF ...

QQQC Crowded With Sellers
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the NASDAQ China Technology ETF (QQQC) entered into oversold ...

Shares of FCHI Now Oversold
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the iShares FTSE China ETF (FCHI) entered into oversold ...

CHII Crosses Below Key Moving Average Level
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the China Industrials ETF (CHII) crossed below their 200 ...

Guggenheim China Real Estate Breaks Below 200-Day Moving Average - Notable for TAO
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the Guggenheim China Real Estate ETF (TAO) crossed below ...

Shares of DBB Now Oversold
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the PowerShares DB Base Metals Fund ETF (DBB) entered ...

iShares Asia Developed Real Estate (IFAS) Enters Oversold Territory
Mon, Jul 6, 12:44 PM ET, by ETF Channel

In trading on Monday, shares of the iShares Asia Developed Real Estate ETF (IFAS) entered ...

Tegna Takes Over #51 Spot From Honeywell International
Mon, Jul 6, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

ETFS Physical Platinum Shares (PPLT) Enters Oversold Territory
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the ETFS Physical Platinum Shares ETF (PPLT) entered into ...

SPDR S&P China (GXC) Enters Oversold Territory
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P China ETF (GXC) entered into oversold ...

DLS Crosses Critical Technical Indicator
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the International SmallCap Values ETF (DLS) entered into oversold ...

Shares of RWX Now Oversold
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the SPDR Dow Jones International Real Estate ETF (RWX) ...

NUGT Crosses Critical Technical Indicator
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the Daily Gold Miners Index Bull 3x Shares ETF ...

DVYE Crowded With Sellers
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the iShares Emerging Markets Dividend ETF (DVYE) entered into ...

Shares of FXR Now Oversold
Mon, Jul 6, 11:44 AM ET, by ETF Channel

In trading on Monday, shares of the First Trust Industrials/Producer Durables AlphaDEX Fund ETF (FXR) ...

VBR: Large Outflows Detected at ETF
Mon, Jul 6, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: VBR Exchange traded funds (ETFs) trade just like stocks, but ...

MXI Crosses Critical Technical Indicator
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the iShares Global Materials ETF (MXI) entered into oversold ...

Shares of EWX Now Oversold
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P Emerging Markets Small Cap ETF (EWX) ...

SuperDividend (SDIV) Enters Oversold Territory
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the SuperDividend ETF (SDIV) entered into oversold territory, changing ...

SPDR S&P China (GXC) Shares Cross Below 200 DMA
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the SPDR S&P China ETF (GXC) crossed below their ...

VT Makes Notable Cross Below Critical Moving Average
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the Vanguard Total World Stock ETF (VT) crossed below ...

HAO Makes Notable Cross Below Critical Moving Average
Mon, Jul 6, 11:34 AM ET, by ETF Channel

In trading on Monday, shares of the Guggenheim China Small Cap ETF (HAO) crossed below ...

PIO Crosses Below Key Moving Average Level
Mon, Jul 6, 11:24 AM ET, by ETF Channel

In trading on Monday, shares of the PowerShares Global Water Portfolio ETF (PIO) crossed below ...

First Trust ISE Cloud Computing Index Fund (SKYY) Enters Oversold Territory
Mon, Jul 6, 11:24 AM ET, by ETF Channel

In trading on Monday, shares of the First Trust ISE Cloud Computing Index Fund ETF ...

iShares MSCI Italy Capped Breaks Below 200-Day Moving Average - Notable for EWI
Mon, Jul 6, 11:24 AM ET, by ETF Channel

In trading on Monday, shares of the iShares MSCI Italy Capped ETF (EWI) crossed below ...

VNQI Crowded With Sellers
Mon, Jul 6, 11:14 AM ET, by ETF Channel

In trading on Monday, shares of the Vanguard Global ex-U.S. Real Estate ETF (VNQI) entered ...

IXG Makes Notable Cross Below Critical Moving Average
Mon, Jul 6, 11:14 AM ET, by ETF Channel

In trading on Monday, shares of the iShares Global Financials ETF (IXG) crossed below their ...

SPDR Morgan Stanley Technology (MTK) Shares Cross Below 200 DMA
Mon, Jul 6, 11:14 AM ET, by ETF Channel

In trading on Monday, shares of the SPDR Morgan Stanley Technology ETF (MTK) crossed below ...

Shares of IFGL Now Oversold
Mon, Jul 6, 11:14 AM ET, by ETF Channel

In trading on Monday, shares of the iShares International Developed Real Estate ETF (IFGL) entered ...

FAS, AFL, ARE, Y: Large Inflows Detected at ETF
Mon, Jul 6, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: FAS, AFL, ARE, Y Exchange traded funds (ETFs) trade just ...

HEDJ: ETF Inflow Alert
Mon, Jul 6, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: HEDJ Exchange traded funds (ETFs) trade just like stocks, but ...

Why John Wiley & Sons is a Top 25 SAFE Dividend Stock (JW.A)
Mon, Jul 6, 8:14 AM ET, by ETF Channel

John Wiley & Sons Inc. (JW.A) has been named to the Dividend Channel ''S.A.F.E. ...

PEP a Top 25 Dividend Giant With $3.77B Held By ETFs
Mon, Jul 6, 8:14 AM ET, by ETF Channel

PepsiCo Inc. (PEP) has been named as a Top 25 ''Dividend Giant'' by ETF Channel, ...

SBM Makes Bullish Cross Above Critical Moving Average
Thu, Jul 2, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the ProShares Short Basic Materials ETF (SBM) crossed above ...

RTM Crosses Critical Technical Indicator
Thu, Jul 2, 3:54 PM ET, by ETF Channel

In trading on Thursday, shares of the Guggenheim S&P 500 Equal Weight Materials ETF (RTM) ...

SPDR S&P Telecom (XTL) Enters Oversold Territory
Thu, Jul 2, 3:54 PM ET, by ETF Channel

In trading on Thursday, shares of the SPDR S&P Telecom ETF (XTL) entered into oversold ...

Akamai Technologies Takes Over #104 Spot From AMETEK
Thu, Jul 2, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

See How Coca-Cola Ranks Among Analysts' Top Dow 30 Picks
Thu, Jul 2, 11:54 AM ET, by ETF Channel

A study of analyst recommendations at the major brokerages shows that Coca-Cola Co (KO) is ...

VCIT: Large Inflows Detected at ETF
Thu, Jul 2, 11:34 AM ET, by ETF Channel

Symbols mentioned in this story: VCIT Exchange traded funds (ETFs) trade just like stocks, but ...

  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

5 High Yield, Low Volatility ETF Plays | Self Directed Investor | Copyright © 2008 - 2015, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of serious individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.