Any exchange-traded fund that seeks to provide high dividend yields by investing in a basket of high-dividend paying common stocks, preferred stocks or REITs. There are dividend ETFs that contain only
Although dividend ETFs are passively managed around an index, that index may be the result of certain quantitative screens such as companies with a history of increasing their dividends, or larger blue-chip companies with a higher level of perceived safety. The expense ratios of dividend ETFs should be comparable to, or lower than, the cheapest no-load mutual funds with similar investment objectives. As with all ETFs, dividend ETFs can be traded intraday. These types of funds may be part of the core portfolio of an income-seeking or generally risk-averse stock investor.