If you're looking for a passive income then exchange traded funds (ETFs) could be used to achieve this goal.
For example, the two ASX-listed ETFs named below could be top candidates as they have been designed to provide investors with above-average dividend yields.
Here's what you need to know about them:
BetaShares S&P 500 Yield Maximiser (ASX: UMAX)
The first ETF for income investors to look at is the BetaShares S&P 500 Yield Maximiser.
It aims to provide income investors with attractive quarterly income and low volatility via an equity income investment strategy over a portfolio of shares comprising the S&P 500 Index on Wall Street.
Among the shares listed on the S&P 500 index are dividend-paying giants such as Apple, Bank of America, Exxon Mobil, Home Depot, and Walmart.
However, true to its name, this clever strategy allows the ETF to maximise the yields on offer with the stocks to create a yield that is greater than you would normally receive from the index.
For example, at present, the BetaShares S&P 500 Yield Maximiser's units were offering investors a 7.9% distribution yield.
Based on the above, a $100,000 investment in this ETF would generate $7,900 of passive income.
Vanguard Australian Shares High Yield ETF (ASX: VHY)
Another ETF that could give you a passive income boost is the Vanguard Australian Shares High Yield ETF.
This ETF provides investors with exposure to a diverse group of ASX shares that have higher forecast dividend yields relative to the rest of the market.
At present there are 74 ASX shares included in the portfolio. These include giants such as BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), Rio Tinto Ltd (ASX: RIO), Telstra Corporation Ltd (ASX: TLS), and Wesfarmers Ltd (ASX: WES).
The Vanguard Australian Shares High Yield ETF currently trades with an estimated forward dividend yield of 5.6%.
This means that a $100,000 investment could generate $5,600 of passive income for investors.
