20 Best & Worst Dividend ETFs: 2014

Slideshow December 16, 2014 at 10:05 AM
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Dividend exchange-traded funds have been among the hottest products in the investing space in recent years, according to ETF Database, and they remained in the limelight this year.

Although the Federal Reserve has intimated that a rate rise is coming, it has not set a definitive timeline when rates will rise above current near-zero levels. This has prompted investors to search for yield to add a steady income stream to their portfolios, and many have liked what dividend ETFs offer.

On Monday, ETFdb listed the best and worst performing dividend ETFs this year. It noted that the funds its researchers had chosen were classified as dividend focused and not simply ones that paid a dividend.

All 10 of the best-performing ETFs outpaced the SPDR S&P 500 ETF (SPY), while providing a dividend-focused strategy for investors, according to ETFdb.

Best-Performing Dividend ETFs

(Photo: AP)

10. S&P 500 Aristocrats ETF — 12.02%

6. Equity Income ETF — 14.01%

3. Ultra Dividend Fund — 17.84%

(ETFdb noted that although these two leveraged funds could provide stellar returns in bull markets, they had the potential for big losses in bear stretches.)

Worst-Performing Dividend ETFs

(Photo: AP)

The U.S. had a relatively strong year—up more than 12%, despite the October slump—but the story was different overseas. ETFdb researchers found that none of the 10 worst performing funds were U.S. focused, but instead homed in on emerging markets or other countries overseas.

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