High Dividend Retirement Payers

Any thoughts on QYLD or PBR for high dividend yields? Thanks.

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It’s (QYLD) a high risk ETF in a rising market, but this sideways market has allowed QYLD to generate some nice taxable returns in the 12% range/per annum over the last 6 months or so. There are some other threads where the negatives have been pointed out. If you use the search bar up in the right hand corner for QYLD you can go over those threads. Not well informed on PBR but its price action suggests buyers getting in and out to collect the dividends which are pretty solid too…doc

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PBR is a difficult investment to commit to. With a current yield of 65%(!) but a bizarrely high variation in dividend payouts and timing, it’s questionable.

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More to this: Petrobras does not have a good track record when it comes to paying shareholders dividends. It eliminated the dividend in 2014 and did not pay one again until 2018.

Petrobras’ largest shareholder is the Brazilian government. As a result, the dividend has become the plaything of recent presidents.

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There are a lot of high dividend ETF’s. I was surprised when I started to look this list over…doc

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Flagged the above post as spam.

Doc,

Thanks for posting that link to BarChart. You’re right. The number of high-yielding ETFs is surprisng, I used BC’s ‘flip chart’ feature and found one near enough to the “starting gate” to buy.

[Later.] The market confirmed that my entry was correct, and I’m already ITM on the trade, which --actually-- won’t be a ‘trade’, but a longer-term holding.

As Hannibal would say, "I love it when a plan comes together. "

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Doc,

That list is a gold mine. Picked up shares of a couple more divvies.

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Doc,

Schwab’s stock screener returns just 29 stocks (traded on the major exchanges) that pay monthly and have a div yld of 6% or better compared to 103 ETFs.

Why the 6% cut-off? Because the risk-free rate --for which the 13-week bill is a good proxy-- has a tax-equivalent yield --depending on one’s own tax-rate, 'natch-- of only 25 beeps less than that.

But 132 choices is still a target-rich environment.

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If they pay monthly they likely aren’t traditional “stocks” as in purely equity instrument (that usually pay dividends quarterly). Maybe they are preferreds that trade on the exchange? Or maybe something else? And it’s also possible that those “dividends” aren’t qualified dividends, so are treated differently when it comes to taxes.

I would be extremely leery of some of the ETFs on that list. No investment can pay an excessively high dividend for very long without:

  1. Having the NAV increase enough to bring the yield back in line with the rest of the market/industry or
  2. Cutting the dividend.

Additionally, many of those on that list appear to be paying such a high yield because of such a massive drop in NAV. That might be indicative of a buying opportunity, or it might be a sign to just stay away.

Some deals (and dividends) are too good to be true (for long). I will note that when I looked at this list last week, the top ETF was paying a dividend of over 40%. I did not note the name but as of this morning, the top ETF has a dividend of 33%. No idea what happened to that ETF that was over 40% but the top ETF today is not the same as the one last week.

I will also note that the top ETF today, SARK, has ONLY 7100 shares outstanding and only 293mm AUM. The entire ETF is worth less than $300mm.

Hawk,

To your cautions, I’d add others, which is neither ‘here’ nor ‘there’, because everyone will have their own checklists and vetting procedures.

The point I was making --that Doc was making-- is that the stocks touted as "Dividend Aristocrats’ often aren’t the most effective choices if it’s an income stream one is trying to create rather than gains from price apprecation.

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