Unfortunately, it looks as though interest rates are going to be staying at these ultra low levels for some time to come. In light of this, I continue to believe the share market is the best place to earn a passive income.
But which ASX dividend shares should you buy this week? Here are two dividend shares I would buy right now:
Dicker Data Ltd (ASX: DDR)
Dicker Data is Australia’s leading distributor of IT hardware, software, cloud, and Internet of Things solutions with over 5,500 reseller partners. Thanks to an increasing number of vendor agreements over recent years, it now distributes a wide suite of products from the world’s leading technology vendors. These include Cisco, Citrix, Dell Technologies, Hewlett Packard Enterprise, HP, Lenovo, and Microsoft.
Due to a combination of these vendor agreements and the growing demand for information technology products, Dicker Data has delivered consistently solid earnings and dividend growth over the last few years. Pleasingly, this strong form has continued during the pandemic as demand for IT and cloud products increases thanks partly to the work from home initiative. In light of this, management expects to increase its fully franked dividend by 31% to 35.5 cents per share in FY 2020. Based on the latest Dicker Data share price, this represents an attractive 4.75% dividend yield.
Vanguard Australian Shares High Yield ETF (ASX: VHY)
A second option for income investors to consider buying right now is an exchange traded fund. I think the Vanguard Australian Shares High Yield ETF is a great option due to its focus on high yield shares. The fund is invested in a total of 66 of them, which I believe provides some much-needed diversity. Something which has proved to be very important during the pandemic.
Among its holdings you will find the banks, BHP Group Ltd (ASX: BHP), and Telstra Corporation Ltd (ASX: TLS) to name just a few. Based on the current Vanguard Australian Shares High Yield ETF share price, I estimate that it offers a FY 2021 dividend yield somewhere in the region of 4% to 5%.