Investors are scouring the market for better dividend options amid the S&P/ASX 200 Index (ASX: XJO)'s average dividend yield falling below 3.5% this year.
Here are two ASX exchange-traded funds (ETFs) that you might like to consider.
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Betashares S&P Australian Shares High Yield ETF (ASX: HYLD)
The brand new ASX ETF, launched by Betashares in August, has $46 million in net assets under management.
It's delivered 5.26% total returns since its inception on 1 August, and trades on a trailing 12-month dividend yield of 4.42%.
HYLD ETF pays income to investors every month, and tracks the S&P/ASX 200 High Yield Select Index before fees.
It invests in 50 ASX shares with high forecast dividend yields.
HYLD ETF's top holdings are currently Westpac Banking Corp (ASX: WBC) shares, National Australia Bank Ltd (ASX: NAB), ANZ Group Holdings Ltd (ASX: ANZ), BHP Group Ltd (ASX: BHP), Wesfarmers Ltd (ASX: WES), Macquarie Group Ltd (ASX: MQG), and Telstra Group Ltd (ASX: TLS).
Betashares says HYLD ETF screens out potential 'dividend traps'.
A dividend trap is a share with an unusually high income yield that isn't sustainable. It's usually the result of a declining share price.
The management fee is 0.25% per year.
The HYLD ETF is currently $31.69 per unit, down 0.2% on Friday.
Australian Top 20 Equities Yield Maximiser Complex ETF (ASX: YMAX)
The YMAX ETF has $619 million in net assets under management. It's been trading on the market since November 2012.
YMAX ETF delivered a net yield of 7.6% and a gross yield (including 45% franking) of 9% over the year to 30 September.
This ASX ETF provides quarterly income but also aims to deliver some capital growth, as well as less volatile returns.
YMAX does not track an index.
Instead, it has a strategy of investing only in the top 20 ASX 200 shares and selling covered call options on up to 100% of its shares.
This generates extra income from the option premiums, on top of the dividends paid by the ASX shares in its portfolio.
YMAX's largest holdings are Commonwealth Bank of Australia (ASX: CBA) shares, Westpac, NAB, BHP, Fortescue Ltd (ASX: FMG), Rio Tinto Ltd (ASX: RIO), Wesfarmers Ltd (ASX: WES), Telstra, and Coles Group Ltd (ASX: COL).
The ETF's management fee and expenses total 0.64% of the fund's net asset value (NAV) per year.
The YMAX ETF is currently $7.75 per unit, up 0.4% on Friday.
