4 Must Own Dividend ETFs [iShares Trust, iShares S&P US Pref Stock Idx Fnd (ETF)]

3. PowerShares S&P 500 BuyWrite (NYSEARCA:PBP)

PowerShares S&P 500 BuyWrite (NYSE:PBP) uses one of my favorite strategies to generate distributions for shareholders.  It writes covered call options against long positions in S&P 500 stocks.  The managers are content to collect premiums by selling call options on the stocks.  If they get called away, so be it.  They just buy the stock back and sell another call against it.   If they hold onto the stock, that’s fine, too!  It’s not great if the market gets clobbered, because they are writing calls and holdings stocks all the way down, but the premiums collected act as a hedge on the downside.  It yields 6.93%.4.

4. Guggenheim Multi-Asset Income ETF (NYSEARCA:CVY)

Finally, I would choose Guggenheim Multi-Asset Income ETF (NYSE:CVY).  This ETF invests across all asset classes in an effort to generate income from the entire economy.  Financials are a bit heavier than I’d like, representing 37% of the ETF, with energy at 19%.  But utilities are there at 8.5%, consumer discretionary at 8%, materials at 7.5%, and so on down the line.  I like the diversification here.  Its 150 holdings generate a 4.72% yield.

Lawrence Meyers owns shares of PFF.

This article is brought to you courtesy of Lawrence Meyers from Wyatt Investment Research.

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