For a DIY Income Investor, the right choice of ETFs can be a big help. They can provide cost-effective diversification (and thus a measure of safety), simplify the running of your portfolio plus give easy access to dividend shares from around the world, in various currencies.
For this post I have trawled through the list of ETFs quoted on the London Stock Exchange (LSE) published by The Financial Times and Morningstar, which seems to be comprehensive (it includes all the dividend ETFs I hold, for example).
Sometimes there is a choice in the currency that the ETF is quoted in - I usually buy the Sterling (GBX=pence) one but you might want to diversify your currencies. All follow a specific index and many are based on physical holdings and pay out the dividends; others are more synthetic (using tools like swaps) and do not pay out any income, but just roll up the total return.
(Note: Yields are as at the date of publication - they will change!)
UK
iShares UK Dividend UCITS ETF IUKD:LSE:GBX (Yield 4.3%)
Amundi ETF FTSE UK Dividend Plus UCITS ETF AUKD:LSE:GBX (Accumulation)
SPDR S&P UK Dividend Aristocrats ETF UKDV:LSE:GBP (Yield 3.7%)
US
SPDR S&P US Dividend Aristocrats ETF UDVD:LSE:USD (Yield 2.0%)
SPDR S&P US Dividend Aristocrats ETF USDV:LSE:GBP (Yield 2.0%)
Euroland
db x-trackers Euro Stoxx® Select Dividend 30 UCITS ETF 1D XD3E:LSE:GBX (Yield 4.4%)
iShares EURO Dividend UCITS ETF IDVY:LSE:GBX (Yield 4.5%)
Lyxor UCITS ETF Eurostoxx50 Dividends DIV:LSE:EUR (Accumulation)
Lyxor UCITS ETF Eurostoxx50 Dividends LDIV:LSE:GBX (Accumulation)
SPDR S&P Euro Dividend Aristocrats ETF EUDI:LSE:EUR (Yield 3.8%)
SPDR S&P Euro Dividend Aristocrats ETF EUDV:LSE:GBP (Yield 3.8%)
Asia Pacific
iShares Asia Pacific Dividend UCITS ETF IAPD:LSE:GBX (Yield 5.2%)
iShares Asia Pacific Dividend UCITS ETF IDAP:LSE:USD (Yield 5.0%)
db x-trackers MSCI AC Asia Ex Japan High Dividend Yield Index UCITS ETF 1D N2F/XAHD:LSE:USD (Yield 4.1%)
db x-trackers MSCI AC Asia Ex Japan High Dividend Yield Index UCITS ETF 1D AHD/XAHG:LSE:GBX (Yield 4.3%)
SPDR S&P Pan Asia Dividend Aristocrats UCITS ETF PADV:LSE:GBP
Emerging Markets
iShares Emerging Markets Dividend UCITS ETF SEDY:LSE (Yield 4.1%)
iShares Emerging Markets Dividend UCITS ETF IEDY:LSE:USD (Yield 4.0)
SPDR S&P Emerging Markets Dividend ETF EDVD:LSE:USD (Yield 5.8%)
SPDR S&P Emerging Markets Dividend ETF EMDV:LSE:GBP (Yield 6.1%)
Global
db x-trackers Stoxx® Global Select Dividend 100 UCITS ETF 1D XGDD:LSE:GBX (Yield 4.7%)
db x-trackers Stoxx® Global Select Dividend 100 UCITS ETF 1D XGSD:LSE:USD (Yield 4.5%)
ETFX Dow Jones Global Select Dividend Fd GDIV:LSE:USD (Accumulation)
SPDR S&P Global Dividend Aristocrats UCITS ETF GBDV:LSE:GBP (Yield 1.6%)
SPDR S&P Global Dividend Aristocrats UCITS ETF GLDV:LSE:USD (Yield 1.6%)
Vanguard FTSE All-World High Dividend Yield UCITS ETF VHYD:LSE:USD (Yield 1.4%)
Vanguard FTSE All-World High Dividend Yield UCITS ETF VHYL:LSE:GBP (Yield 1.0%)
I hope this will be useful if you have a bit of time over the holidays to review your portfolio and do a bit of your own research. Let us know which ones you fancy!
I am not a financial adviser and the information provided does not constitute financial advice. You should always do your own research on top of what you learn here to ensure that it's right for your specific circumstances.
Do any have the dreaded "Minimum Investment £100,000"?
ReplyDeleteI haven't found one like that yet!
DeleteThanks for a really useful list.
ReplyDeleteI would love to invest in some of the US dividend champions direct, but haven't been able to find an easy way to do that and re-invest dividends. The accumulation etf's may be the way forward.
Once again, thanks for listing the otions
The Vanguard All World High Yield EFT has a yield of around 3.7% according to the Vanguard factsheet. It has not been available for a full year which has, I think, confused your data source publication.
ReplyDeleteThe source was Bloomberg, no less - but I think you may be right. I am expecting the higher yield you mention but as this is aspirational at the moment, I don't want to plug it too hard..
DeleteAre the Vanguard world ETFs just yield to date because they're so new (i.e. still not a full year)? And do you know which of the ETFs listed have increased dividend payouts in the last 2-3 years, or at least not decreased them? I seem to recall looking at IAPD and their payout has risen, whereas EMDV has declined slightly (though I may be wrong on this)?
ReplyDeleteI'd be very wary of IUKD as it has a tendency to be full of rubbish stocks where the market believes the dividend will be cut e.g., Man was in its top ten for a long time, but has now disappeared, it was full of retailers at the beginning of the crisis and before the crisis banks like Alliance and Leicester... It's top ten holdings don't look like the worst today but I'd recommend reading the prospectus and being comfortable with its selection criteria before buying.
ReplyDeleteheres one you missed
ReplyDeleteSPDR® S&P® Pan Asia Dividend Aristocrats UCITS ETF
Well done that man! I'll add it to the list.
ReplyDeleteIs there an ETF for TIPS that I can hold in an S&S ISA?
ReplyDeleteHi dearieme
DeleteNot my thing, I'm afraid. Keeping up with inflation (in my case UK inflation) is a kind of minimum baseline I set to monitor progress - not my target!