Best Stocks, ETF’S and Mutual Funds for Yield
Letting your money work for you is one way to live a simple life. That has always been the idea behind investing in any asset that pays a yield. Passive income is something you should be focused on. One of the easiest ways to let your money work for you is in the stock market. I have listed three of my favorite stocks, ETF’s and mutual funds that pay you to own them. The market will fluctuate but if you continue to invest in your favorite companies, you should keep a good average share price and reinvest your dividends until you are ready to use them to pay you in retirement. It can be that simple.
So, what should you invest in? You have the options to build your own portfolio of stocks, ETF’s, and Mutual Funds. A lot of it will depend on your invest style and frequency. If you want to build a portfolio of stocks you need to keep in mind that a lot of brokers charge commission to buy and sell stocks. That means if you are trying to make small buys weekly your commission may eat up a 5% value of you share price. Buying one or two stocks can also be riskier than buying a basket of stocks. That is what you get when you buy ETF’s and Mutual Funds.
ETFs are a basket of stocks usually in a sector or trying to track a specific index. These are less risky to own compared to a single stock. They are usually less actively managed than a mutual fund. They are a great asset to own and put money in weekly. Check how much commission you are paying when buying these. Some broker will charge you a percentage of the amount and some will charge you a set fee for every buy and sell. Why I am big on looking at this is because if you put $100 into an ETF a week and your broker charges you $5 for commission that is 5% of your money not going into the ETF. That adds up. For instance, if you buy 2 shares of a $50 stock you now need that stock to hit $52.50 to break even. When you are focused on compound interest and earing yield every 5% matters. The bigger your purchases the less it matters as well. If you buy $1000 worth of that same $50 ETF and only pay a $5 commission, you are only losing .5% of your money. That commission will get spread over 20 shares instead of 2.
That brings us to mutual funds. They are a buy, continue to add and hold. They will usually charge you a $50 fee if you sell your purchase less than 90 days (about 3 months) of buying it. This keeps the frequent trading out of the fund. Some will have an initial investment amount but after that you can buy 1$ worth. This is great if you want to have just $10 a week put into the fund, because no commission is charged. I use this for my kids and myself. If you start your newborn a custodial account, you can easily add $5-10 dollars a week. These funds are usually actively traded by a professional whose focus is to beat the market and make you money. Because they are actively traded, they do charge a fee that is around 1%. I always look for All-star funds but that does not mean others are not good for just dividend yield. Below you will see Mutual Funds that are for Yield. I believe only one is an All-Star Fund but that does not mean the others are not good to own.
Pays 3.84% Yield.
Seagate Technology public limited company is a provider of electronic data storage technology and solutions. The Company's principal products are hard disk drives (HDDs). In addition to HDDs, it produces a range of electronic data storage products, including solid state hybrid drives, solid state drives, peripheral component interconnect express (PCIe) cards and serial advanced technology architecture (SATA) controllers. Its storage technology portfolio also includes storage subsystems and high-performance computing solutions. Its products are designed for applications in enterprise servers and storage systems, client compute applications and client non-compute applications. It designs, fabricates and assembles various components found in its disk drives, including read/write heads and recording media. Its design and manufacturing operations are based on technology platforms that are used to produce various disk drive products that serve multiple data storage applications and markets.
Pays 4.81% Yield.
AbbVie Inc. (AbbVie) is a research-based biopharmaceutical company. The Company is engaged in the discovery, development, manufacture and sale of a range of pharmaceutical products. Its products are focused on treating conditions, such as chronic autoimmune diseases in rheumatology, gastroenterology and dermatology; oncology, including blood cancers; virology, including hepatitis C virus (HCV) and human immunodeficiency virus (HIV); neurological disorders, such as Parkinson's disease and multiple sclerosis; metabolic diseases, including thyroid disease and complications associated with cystic fibrosis, and other serious health conditions. It offers products in various categories, including HUMIRA (adalimumab), Oncology products, Virology Products, Additional Virology products, Metabolic/Hormones products, Endocrinology products and other products, which include Duopa and Duodopa (carbidopa and levodopa), Anesthesia products and ZINBRYTA (daclizumab).
Pays 4.32% Yield.
Verizon Communications Inc. is a holding company. The Company, through its subsidiaries, provides communications, information and entertainment products and services to consumers, businesses and governmental agencies. Its reportable segments are Verizon Consumer Group and Verizon Business Group. Its Consumer segment provides wireless and wireline communications services. Its wireless services are provided across wireless networks in the United States under the Verizon Wireless brand. Its wireline services are provided in nine states in the Mid-Atlantic and Northeastern United States, over its 100% fiber-optic network under the Fios brand and via traditional copper-based network. Its Business segment provides wireless and wireline communications services and products, video and data services, corporate networking solutions, security and managed network services, local and long-distance voice services and network access to deliver various Internet of Things (IoT) services and products.
Pays 6.76% Yield.
The investment seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx SuperDividend U.S. Low Volatility Index ("underlying index"). The fund invests at least 80% of its total assets in the securities of the underlying index. The underlying index tracks the performance of 50 equally-weighted common stocks, including Master Limited Partnerships ("MLPs") and Real Estate Investment Trusts ("REITs") that rank among the highest dividend yielding equity securities in the United States.
Pays 11.58% Yield.
The investment seeks to provide investment results that closely correspond, before fees and expenses, generally to the price and yield performance of the CBOE NASDAQ-100 BuyWrite V2 Index (the "underlying index"). The fund will invest at least 80% of its total assets in the securities of the underlying index. The CBOE NASDAQ-100 BuyWrite Index is a benchmark index that measures the performance of a theoretical portfolio that holds a portfolio of the stocks included in the NASDAQ-100 Index, and "writes" (or sells) a succession of one-month at-the-money NASDAQ-100 Index covered call options. It is non-diversified.
Pays 3.1% Yield.
The investment seeks to track the investment results of the Dow Jones U.S. Select Dividend Index composed of relatively high dividend paying U.S. equities. The fund generally invests at least 90% of its assets in securities of the underlying index and in depositary receipts representing securities of the underlying index. The underlying index measures the performance of the U.S.'s leading stocks by dividend yield.
Mutual Funds for Yield
VHYAX VANGUARD HIGH DIVIDEND YIELD INDEX ADM
Pays 3.04% Initial investment of $3000 required.
The investment seeks to track the performance of a benchmark index that measures the investment return of common stocks of companies that are characterized by high dividend yield. The fund employs an indexing investment approach designed to track the performance of the FTSE High Dividend Yield Index, which consists of common stocks of companies that pay dividends that generally are higher than average. The adviser attempts to replicate the target index by investing all, or substantially all, of its assets in the stocks that make up the index, holding each stock in approximately the same proportion as its weighting in the index.
VWEHX VANGUARD HIGH-YIELD CORPORATE INV
Pays 4.56% Initial investment of $3000 required.
The investment seeks to provide a high level of current income. The fund invests primarily in a diversified group of high-yielding, higher-risk corporate bonds-commonly known as "junk bonds"-with medium- and lower-range credit-quality ratings. It invests at least 80% of its assets in corporate bonds that are rated below Baa by Moody's Investors Service, Inc. (Moody's); have an equivalent rating by any other independent bond-rating agency; or, if unrated, are determined to be of comparable quality by the fund's advisor. The fund's high-yield bonds and loans mostly have short- and intermediate-term maturities.
MHCAX MAINSTAY MACKAY HIGH YIELD CORP BD A
Pays 5.42% Initial Investment of $1000 required.
The investment seeks maximum current income through investment in a diversified portfolio of high-yield debt securities; capital appreciation is a secondary objective. The fund, under normal circumstances, invests at least 80% of its assets (net assets plus any borrowings for investment purposes) in high-yield corporate debt securities, including all types of high-yield domestic and foreign corporate debt securities that are rated below investment grade or that are unrated but are considered to be of comparable quality by the Subadvisor. It may invest up to 20% of its net assets in common stocks and other equity-related securities.
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