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Against this backdrop, investors are turning to dividend-yielding stocks to hedge their portfolios against market volatility by ensuring a steady income stream. However, because betting on dividend-paying stocks can be risky too, because many of them could suffer a correction with the broader market, it could be wise to invest in dividend-paying ETFs to ensure broader portfolio diversification at lower risk.
Considering these factors, we think dividend-paying ETFs Vanguard Dividend Appreciation Index Fund ETF Shares (VIG), iShares iBoxx $ High Yield Corporate Bond ETF (HYG), SPDR S&P Dividend ETF (SDY), and Utilities Select Sector SPDR Fund (XLU) are solid bets now.
