Overview
- Dividend exchange-traded funds are described as making a comeback in 2026 after several difficult years for income strategies.
- The shift toward value, low-volatility, and defensive stocks is highlighted as a key driver supporting dividend payers this year.
- State Street’s SPDR S&P Dividend ETF (SDY) targets companies with 20-plus years of dividend growth, weights by yield, offers a 2.4% yield, leans into industrials, consumer staples, utilities, and financials, and carries a forward P/E near 18.
- Invesco’s S&P 500 High Dividend Low Volatility ETF (SPHD) selects 50 low-volatility names from the 75 highest yielders in the S&P 500, yields 4.5%, includes 20% real estate, and notably holds no technology stocks.
- As context, one broad dividend proxy from WisdomTree gained about 50% from 2023 to 2025, trailing roughly 86% for the Vanguard S&P 500 ETF over the same span.