#high-yield-etfs

#high-yield-etfs

If 2025 has taught investors anything about investing, it's that the markets have a mind of their own. Even when the bulls appear to dominate, the bears have had the fortitude to wrestle back control, leaving the markets in flux and investors scrambling to keep up. While perks like 2026 COLA increases can help, high yield ETFs could take you further ahead.

As interest rates ease and bond rates soften to follow suit, you may be looking for ways to continue generating steady income in your investment portfolio. To that end, you may want to look at ETFs, or exchange-traded funds, which allow you to own a collection of stocks with a single investment. If you have a reasonably healthy appetite for risk, it pays to focus on high-yield ETFs that reward you with regular income.

With a total cash account of $200,000, you can invest $50,000 in four stocks or exchange traded funds (ETFs) and possibly collect $50,000 worth of annual passive income. It's not magic or pure luck. Rather, it's a matter of finding a couple of dividend champion stocks and some high-yield ETFs. To receive $50,000 in annual dividends/distributions from a $200,000 total investment, you'll need an average yield of at least $50,000 / $200,000, or 25%.

Whether you're just walking into the world of investing or getting closer to retirement, generating a powerful stream of regular income is a key goal for any investor. To do this, many turn to dividend paying stocks. Dividends are regular payments some companies make out of their profits. But you can also invest in dividend-paying ETFs. These are professionally managed funds that can invest in hundreds or even thousands of dividend paying ETFs.

The Roundhill S&P 500 Target 20 Managed Distribution ETF is an actively managed ETF that pays monthly distributions at a target annualized rate of 20% while maintaining exposure to the S&P 500 Index. It does so by investing at least 80% of its net assets in FLEX Options (Flexible Exchange Options) that reference the SPDR S&P 500 ETF (NYSEARCA:SPY ) . These specialized options contracts allow the fund to replicate S&P 500 exposure while generating the cash flow needed for its high monthly distribution payments.

The answer might seem to be yes, especially when we take note of the gigantic yield of the YieldMax Ultra Option Income Strategy ETF (NYSEARCA:ULTY). Surely, the temptation to take a YOLO (You Only Live Once) trade with the ULTY ETF is strong as the fund's yield is huge. It feels like you can just sit back and hold the YieldMax Ultra Option Income Strategy ETF, and you're guaranteed to turn a profit eventually.