Money market funds and short Treasury bills near 4.6% raise the hurdle for taking equity-like risk. Income investors want funds that pay enough to justify leaving cash. Three under-followed ETFs offer different income engines: DYV holds globally diversified investment-grade corporate bonds with a stated current yield of 5.5%, aiming to capture credit spreads the manager views as overstating default risk. SPHD screens the S&P 500 for high dividends among lower-volatility stocks to provide monthly distributions. PFFA focuses on preferred stock from infrastructure issuers and uses modest leverage to enhance income potential. The article frames these funds as mispriced versus household-name dividend ETFs due to lower scale and visibility.
"Invesco S&P 500 High Dividend Low Volatility ETF (SPHD) screens the S&P 500 for the highest dividends among the least jumpy stocks. Virtus InfraCap U.S. Preferred Stock ETF (PFFA) uses modest leverage on preferred stock of infrastructure issuers. None of these trade near the size of the household-name dividend ETFs, which is part of why they remain mispriced relative to the income they throw off."
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