Last month, I proclaimed short (but not ultra-short) maturities as the ideal place along the present fixed-income curve. Is there also an ideal target for yield-seeking stock investors?
This year has been swell for popular dividend funds. Through June 30, for example, the Schwab U.S. Dividend Equity ETF (SCHD) returned 18%, boosted by tech and drug winners. Based on its most recent quarterly distribution, the exchange-traded fund yields 2.7%, which lags utilities, energy partnerships, real estate investment trusts (REITs) and even a fourth of the names in the S&P 500. Perhaps the path to optimizing dividends is simply to concentrate on pipelines, REITs and utilities. But that leaves out a pile of possibilities.
