ETFs: Has "high yield" been hyped?

The creation of a niche of dividend-focused ETFs might be enticing, but we're yet to see stellar performance…in fact it’s been awful.

Summary:  A spate of high yield ETF launches aim to cater to investors wanting high yields in an environment where defensive investments are not returning what they used to. However, investors should be aware than while the income generated by these funds might be higher than an ETF tracking the ASX200, overall returns have been lower than vanilla ETFs over the past year.

Key take-out:High yield ETFs are relatively new, so it’s difficult to think about long term performance. Be careful not to be won over by marketing speak and look at the actual returns on offer first.



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