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5 Surprise High-Yielding ETFs


Dividend ETFs are booming, and here are five high-yielders you may not know about.

As has been noted countless times in recent months, dividend ETFs are a booming corner of the exchange-traded products universe. With good reason, too. In this topsy-turvy market, depending on capital appreciation alone is a tricky bet.

At this point, the yield story as it pertains to ETFs has not been completely unveiled. Most investors know they can find robust yield with a fund like PowerShares Financial Preferred ETF (PGF) or get exposure to a broad swath of dividend payers with an ETF like the Vanguard Dividend Appreciation ETF (VIG).

What about going off the beaten path in search of some high-yielding ETFs? Let's do just that right now with these surprise high-yielders.

1. Guggenheim Shipping ETF (SEA): The Guggenheim Shipping ETF is one of just a few ETFs focusing on transportation stocks, and while the chart isn't a thing of beauty, SEA doesn't focus on the more speculative names in the shipping sector. The investor willing to embrace some risk and volatility with SEA will sail away with a yield that is currently 6.73%.

2. iShares MSCI Brazil Index Fund (EWZ): No need to do a double take. You're seeing this correctly. The iShares MSCI Brazil Index Fund is indeed a high yielder. No, EWZ is not obscure. It's one of the biggest emerging markets ETFs out there. But as a yield play, it rarely enters the conversation. Let's change that by telling you EWZ now yields 5.4%. Oh yeah, there's great potential for capital appreciation as emerging markets come back into favor.

3. Vanguard MSCI Europe ETF (VGK): For those not living under a rock, the inclusion of the Vanguard MSCI Europe ETF on this list is not a surprise. VGK may have Europe in its name, but it holds some stocks that are worth owning, Royal Dutch Shell (RDS-A) and Nestle (NSRGY) among them. Here are two numbers everyone will like: VGK has an expense ratio of 0.14% and a yield of 5%.

4. WisdomTree Emerging Markets Equity Income Fund (DEM): The WisdomTree Emerging Markets Equity Income Fund probably doesn't qualify as obscure either, but if you're going to cozy up to a multi-country emerging markets ETF, you might as well get paid to do so. Over 41% of DEM's country allocation goes to Taiwan and Brazil, but the ETF features a 30-day SEC yield of almost 8.1%.

5. Biotech HOLDRS (BBH): Biotech isn't usually the first sector income investors head to. Not to mention stock-picking within this group can be about as a pleasant as walking through a minefield. That said, the Biotech HOLDRS offers a jaw-dropping yield of almost 10.4%.

Bull case: None of these ETFs are particularly conservative, so almost everything needs to go right in the broader market for these funds to run higher. Patient investors can find a home with EWZ, DEM and maybe VGK.

Bear case: Get too many more days like Wednesday and VGK will suffer even more. That will drag EWZ and DEM into the muck as well.

Editor's Note: This content was originally published on by the ETF Professor.

Below, find some more great ETF and market content from Benzinga:

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Twitter: @Benzinga

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No positions in stocks mentioned.

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