Sign up for our Moneywise newsletter to receive a steady flow of actionable ideas from Wall Street's top firms.
Vanguard High Dividend Yield ETF (VYM)
A lot of companies pay dividends, but some are more generous than others.
If you want to invest in a portfolio of companies that are characterized by oversized payouts, consider the Vanguard High Dividend Yield ETF.
The fund takes a passive, full replication approach to track the performance of the FTSE High Dividend Yield Index. It holds 443 stocks, so it is well diversified.
The ETF’s top holdings include household names like Johnson & Johnson (JNJ) and Procter & Gamble (PG) — companies that have been paying increasing dividends for decades.
VYM also boasts a very low expense ratio of 0.06%.
More: Best investment apps
Invest in real estate without the headache of being a landlord
Imagine owning a portfolio of thousands of well-managed single family rentals or a collection of cutting-edge industrial warehouses. You can now gain access to a $1B portfolio of income-producing real estate assets designed to deliver long-term growth from the comforts of your couch.
The best part? You don’t have to be a millionaire and can start investing in minutes.
Learn MoreiShares U.S. Dividend and Buyback ETF (DIVB)
Paying dividends isn’t the only way to return cash to investors. Companies can also repurchase their shares. When a company buys back its stock, it reduces the number of shares outstanding, allowing each remaining investor to own a larger portion of the business.
If you want to follow the buyback theme, look into the iShares U.S. Dividend and Buyback ETF.
The fund tracks the Morningstar US Dividend and Buyback Index, which consists of companies with a history of dividends and share repurchases. Its expense ratio is 0.25%.
Right now, DIVB holds 319 stocks, with its three top holdings being Apple (AAPL), Microsoft (MSFT), and Meta Platforms (FB). In 2021, Apple spent $88.3 billion on buybacks, Microsoft spent $29.2 billion, and Meta bought back $50.1 billion of its own shares.
Pacer US Cash Cows 100 ETF (COWZ)
Free cash flow represents the money a company generates after all expenses — including capital expenditures — are paid. If a company generates a lot of free cash flow, it’s typically in a good position to return cash to investors.
That’s why the Pacer US Cash Cows 100 ETF is a potentially timely opportunity.
The fund is based on the Pacer US Cash Cows 100 Index, which screens the Russell 1000 Index to arrive at 100 companies with the highest free cash flow yield. Currently, its top three holdings are Valero Energy (VLO), Dow (DOW), and Occidental Petroleum (OXY).
The index is reconstituted and rebalanced on a quarterly basis. COWZ has an expense ratio of 0.49%.
Sign up for our Moneywise newsletter to receive a steady flow of actionable ideas from Wall Street's top firms.
Retire richer: The secret to building wealth faster
Most people miss out on key opportunities to grow their wealth. Partnering with the right financial advisor can help you secure a brighter future. Learn how to make your money work harder for you today.
Discover the secretMore from Moneywise
- ‘It’s so horrible that I want to buy it’ — Jim Cramer likes these 2 beaten-down tech names that are still posting white-hot revenue growth
- Goldman Sachs likes these 3 top dividend stocks yielding as high as 7.6% — in a manic market, locking down a growing income stream makes sense
- Warren Buffett just said he doesn’t own bitcoin because ‘it isn’t going to do anything’ — he’d rather own these 2 tangible assets instead
The richest 1% use an advisor. Do you?
Wealthy people know that having money is not the same as being good with money. Advisor.com can help you shape your financial future and connect with expert guidance . A trusted advisor helps you make smart choices about investments, retirement savings, and tax planning.
Try it now