High Yeilds and Divideneds

Back in 2007 I wrote a post on the tax rates for dividends. Reading through an old 2008 copy of Money magazine I came across and article on high dividend and high yield ETFs and mutual funds. Funds in their list:

• Vanguard High Dividend Yield (VYM) - Currently, this fund holds no bonds and all equity, with a yield between 4 and 5%.
  
• iShares Dow Jones Select Dividend Index (DVY) - This fund has an even higher yield, possibly due to being 45% percent invested in Financial Services. Current yield is over 5.5%.
  
• SPDR S&P Dividend (SDY) - Again all stocks and about 40% invested in Financial Services, this fund currently yields over 5%.
  
• Vanguard Total Bond Market ETF (BND) - Virtually all bonds with 0.02% of fund invested in stocks. Check the NAV verses the trading price (everyone should do this with all ETFs)!
  
• Vanguard High-Yield Corporate Bond (VWEHX) - This is not an ETF, but a regular mutual fund with a minimum $3000 initial investment. It currently has a yield over 10%!
  
• Vanguard REIT Index (VGSIX) - This REIT fund's value fell off a cliff like most REITs in 2008 & 2007. It is basically 98% stock and 2% cash, with a current yield over 8%. This also is not an ETF, but a regular mutual fund with a minimum $3000 initial investment.

It is important to notice the difference between dividend yield and income yield for tax purposes. The first three funds about appear to be all dividends. My personal favorites are VYM and VWEHX.