This High-Yielding ETF Pays Monthly and Invests in Top Canadian Dividend Stocks
A good way to maintain safety while taking advantage of a high yield is by investing in an exchange-traded fund (ETF) that offers a good payout. For Canadian investors, an excellent option is the Invesco Canadian Dividend Index ETF (TSX:PDC). The fund's portfolio gives you a position in approximately 44 stocks, with a heavy focus on bank stocks. Its top four holdings are Canadian Imperial Bank of Commerce (TSX:CM)(NYSE:CM), Toronto-Dominion Bank (TSX:TD)(NYSE:TD), Bank of Montreal (TSX:BMO)(NYSE:BMO), and Bank of Nova Scotia (TSX:BNS)(NYSE:BNS). In total, financial stocks account for around 40% of its overall portfolio.
The ETF has a management fee of 0.50%, which is comparable to similar funds, and isn't too expensive overall. It makes distributions to investors every month and yields around 4.3%.
Since the start of the year, the Invesco fund has generated returns of around 8%. With a beta value of more than 0.9, the ETF's performance will largely follow how the overall market performs, and thus, it can be a relatively safe investment; it isn't likely to be highly volatile given the nature of its holdings and their stability.
The fund can be a solid option whether you want a good buy-and-hold investment to not worry about, or if you simply want some recurring monthly dividend income to collect.
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