Monthly Dividend Stocks and ETFs: A Comprehensive Guide for Investors
Investors often seek regular income from their investments. This can be met through monthly dividend-paying stocks and Exchange-Traded Funds (ETFs). In this article, we will explore notable examples of both and highlight important considerations for investors.
Monthly Dividend Stocks
Several stocks payout monthly dividends, making them attractive to investors seeking regular income. Here are some notable examples:
Realty Income Corporation (O)
Realty Income Corporation is known for its consistent monthly payouts. It focuses on acquiring and operating industrial properties across the United States. This stability is a key feature for investors seeking regular income.
STAG Industrial Inc. (STAG)
STAG Industrial Inc. specializes in the U.S. industrial property market, providing a steady stream of dividends due to its focus on high-quality, long-term properties. This makes it an appealing option for those looking for reliable monthly income.
Pembina Pipeline Corporation (PBA)
A Canadian company that offers transportation and midstream services for the oil and gas industry, Pembina Pipeline Corporation pays monthly dividends. While the returns can be volatile due to fluctuations in oil and gas prices, the regular dividends can provide a steady income stream.
Monthly Dividend ETFs
In addition to individual stocks, there are many ETFs that offer monthly dividends. Here are some notable examples:
Invesco SP 500 High Dividend Low Volatility ETF (SPHD)
This ETF invests in high-dividend-yielding stocks with low volatility. Designed for investors who want a balanced approach between growth and income, SPHD can provide a consistent monthly payout.
Global X SuperDividend ETF (SDIV)
Focused on high-dividend yielding companies globally, SDIV aims to provide a diversified exposure to a mix of sectors and regions. This can reduce exposure to market volatility and provide regular income.
WisdomTree U.S. High Dividend Fund (DHS)
Targeting U.S. companies with high dividend yields, DHS is designed for investors seeking monthly income. It can provide a broader spread of dividends from various industries within the U.S. market.
Considerations When Investing in Monthly Dividend Stocks and ETFs
Yield vs. Risk
Higher yields often come with increased risk. It is crucial to carefully evaluate the underlying companies or sectors. Conducting thorough research or consulting with a financial advisor can help investors make informed decisions.
Tax Implications
Monthly dividends can have different tax implications depending on the type of account (taxable vs. tax-advantaged). Understanding these implications is important to maximize the benefits of your investments. Consultation with a tax professional can provide guidance on optimizing your dividend income.
Popular Monthly Dividend ETFs
There are numerous excellent ETFs that offer monthly dividends. Here are two favorites:
HNDL (High Dividend Yield ETF)
Primarily for retirement-focused investors, HNDL has approximately 1 billion in assets under management. It provides broad exposure to all US asset classes while paying a consistent monthly dividend. With a current distribution rate of around 7%, an investment of one million dollars could generate an annual income of around $70,000, or $5,833 per month.
GLDB (Global X Advisor Series Gold Dividend ETF)
This ETF offers exposure to gold through its inflation hedge while also benefiting from the dividends/interest paid by its corporate bond portfolio. Although GLDB pays a lower annual dividend (around 3%) and only pays dividends monthly, it can be an attractive option if you believe the price of gold will rise.
In conclusion, monthly dividend stocks and ETFs can provide a steady income stream for investors. By understanding the key considerations such as yield vs. risk and tax implications, and by carefully selecting the right investments, you can build a portfolio that meets your income needs and investment goals.