Global X SuperDividend U.S. ETF vs. SPDR Portfolio S&P 500 High Dividend ETF: Which Is the Better High-Yield ETF?

3 weeks ago 14

Unlock banal picks and a broker-level newsfeed that powers Wall Street.

Reuben Gregg Brewer, The Motley Fool

Sat, Mar 15, 2025, 4:54 AM 6 min read

SPDR Portfolio S&P 500 High Dividend ETF is incredibly elemental to understand. It starts by looking astatine lone the dividend-paying stocks wrong the S&P 500 (SNPINDEX: ^GSPC), which is simply a curated database of mostly ample companies meant to correspond the broader U.S. economy. The dividend payers are lined up by dividend yield, from highest to lowest.

The 80 highest-yielding stocks get enactment into the ETF utilizing an equal-weighting methodology, truthful that each banal has the aforesaid interaction connected wide performance. Aside from the equal-weighting bit, this is simply a beauteous straightforward approach.

Two radical looking astatine paperwork with a calculator.

Global X SuperDividend U.S. ETF is simply a batch much complicated. It starts its screening by looking astatine beta, a measurement of volatility comparative to the broader market. A beta supra 1 suggests the banal is much volatile than the market, portion a beta beneath 1 suggests it is little volatile. Global X SuperDividend U.S. ETF lone selects from stocks with betas adjacent to oregon little than 0.85. The adjacent walk is to destruct stocks with dividend yields beneath 1% oregon supra 20%.

After that, the remaining stocks are checked to guarantee that they person paid dividends for astatine slightest the past 2 years, and that the existent dividend is astatine slightest adjacent to 50% of the erstwhile year's dividend. This past 1 is absorbing due to the fact that it allows for companies that person chopped their dividends to enactment successful the mix. From this last list, the 50 stocks with the highest dividend yields are selected. Like SPDR Portfolio S&P 500 High Dividend ETF, an equal-weighting methodology is applied.

A manus stopping falling dominos from overturning a banal of coins.

Picking stocks utilizing lone a precocious output arsenic the determining origin is simply a risky attack to investing. The database of highest-yielding stocks volition inherently see companies that are facing worldly problems and are, thus, retired of favour connected Wall Street for a bully reason. So, some SPDR Portfolio S&P 500 High Dividend ETF and Global X SuperDividend U.S. ETF person taken steps to assistance trim risk.

SPDR Portfolio S&P 500 High Dividend ETF is relying connected the enactment criteria of the S&P 500 index. The 500 oregon truthful stocks successful the scale are selected by a committee due to the fact that they are ample and economically important. That will, inherently, weed retired little desirable companies implicit time.