With the U.S. Federal Reserve intent on keeping interest rates low until at least late 2014, investing in dividend ETFs (exchange-traded funds) is necessary for income investors who are all but forced to consider asset classes beyond money market accounts and U.S. Treasuries.
The interest rates on products are now so piddly that investors are all but preconditioned to view either equities or high-yield bonds as the most viable options for generating income.
By virtue of the anemic yields on CDs and Treasuries many investors are left thinking the yields on usual suspect blue chip dividend stocks are great. The 3.3% yield offered by consumer staples giant The Procter & Gamble Co. (NYSE: PG) is viewed as "good." These days, BP Plc (NYSE: BP) with its 4.6% dividend yield is considered "stellar."
They're just two examples, but BP and P&G prove the point that in today's market "decent" yields are viewed as "great." That is one reality of today's low interest rate environment.
Another reality is that the low yield story has been overdone. To borrow from baseball terminology, the low yield story is in the ninth inning.
On the other hand, the still unheralded super dividend theme is still in its infancy. The good news is investors can easily tap into the super dividend story with the following ETFs.