Insights

These ASX ETFs could be perfect for dividend-seekers

These ETFs give income investors exposure to Coles Group Ltd (ASX:COL), Commonwealth Bank of Australia (ASX:CBA), and Fortescue Metals Group Limited (ASX:FMG)…
The post These ASX ETFs could be perfect for dividend-seekers appeared first on Motley Fool Australia. –

Woman with binoculars on green background, looking through binoculars, journey, find and search concept.

As well as providing investors with access to international markets, exchange traded funds (ETFs) can be used to generate income.

There are a number of ETFs out there that have been specifically designed to give income investors access to a large number of dividend shares.

Two which I think investors ought to consider buying today are listed below. Here’s why I like them:

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

The first ETF for income investors to consider buying is the iShares S&P/ASX Dividend Opportunities ETF. This fund aims to provide investors with the performance of the S&P/ASX Dividend Opportunities Accumulation Index, before fees and expenses. It has been designed to measure the performance of a diverse group of 50 ASX-listed shares that offer high dividend yields and stability.

Among its holdings you’ll find supermarket operator Coles Group Ltd (ASX: COL), banking giant Commonwealth Bank of Australia (ASX: CBA), iron ore miner Fortescue Metals Group Limited (ASX: FMG), and conglomerate Wesfarmers Ltd (ASX: WES). At present its 12-month trailing dividend yield stands at 4.1%. However, I suspect that this will start to increase at a solid rate once the pandemic passes and dividend payments return to normal.

VanEck Vectors Australian Banks ETF (ASX: MVB)

Another ETF for income investors to consider buying is the VanEck Vectors Australian Banks ETF. As you might have guessed by its name, this ETF gives investors exposure to the Australian banking sector. This means that through a single investment, you’ll be buying a piece of Commonwealth Bank and the rest of the big four, the regional banks, and even Macquarie Group Ltd (ASX: MQG). I think this makes it a great option for investors that are wanting exposure to the banking sector, but aren’t too sure which of the banks to buy.

Estimating the yield that the ETF will offer in FY 2021 is tricky because of the pandemic. However, when things return to normal, I would expect a yield in the region of 5% to 6%. For now, I would estimate a partially franked 4% yield over the next 12 months.

These Dividend Stocks Could Be Your Next Cash Kings (FREE REPORT)

Motley Fool Australia’s Dividend experts recently released a brand-new FREE report revealing 3 dividend stocks with JUICY franked dividends that could keep paying you meaty dividends for years to come.

Our team of investors think these 3 dividend stocks should be a ‘must consider’ for any savvy dividend investor. But more importantly, could potentially make Australian investors a heap of passive income.

Don’t miss out! Simply click the link below to grab your free copy and discover these 3 high conviction stocks now.

Click Here For Your Free Stock Report

Returns As of 6th October 2020

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Wesfarmers Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post These ASX ETFs could be perfect for dividend-seekers appeared first on Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!