"Generating passive income is a way to make your money work for you, with little effort. If you manage to choose the right investments, money will simply flow into your account from time to time. There are different sources of passive income, and one of the most popular today is an exchange-traded fund (ETF). You can invest in dividend-paying stocks but you'll have to research and keep them on your radar. If there's market uncertainty, your investment may lose value."
"SPYD holds the top 80 dividend-paying stocks in the S&P 500 and has a dividend yield of 4.63%. The ETF has an expense ratio of 0.07% annually, meaning you'll pay $7 for every $10,000 you invest in the fund. The fund is inclined towards midcap companies and picks value stocks over growth stocks. About 22% of the assets are in real estate, followed by 17% in consumer staples companies, 15% in financials, and 13% in utilities."
Passive income can be generated through dividend-focused exchange-traded funds that combine diversification, low costs, and trading flexibility. ETFs reduce single-stock risk by holding baskets of dividend-paying companies and pay out dividends on a regular schedule. The SPDR Portfolio S&P 500 High Dividend ETF (SPYD) holds the top 80 dividend-paying S&P 500 stocks, yields 4.63%, and has a 0.07% expense ratio. SPYD tilts toward midcap and value stocks, with roughly 22% real estate, 17% consumer staples, 15% financials, and 13% utilities. Top holdings include AbbVie, CVS Health, Altria Group, and HP Inc. SPYD pays quarterly dividends and has shown strong five-year performance.
Read at 24/7 Wall St.
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