These ETFs include the iShares Core S&P/ASX 200 ETF (ASX: IOZ), which is trading at $36.06 per unit, up 0.33% this morning.

Investors participating in the distribution reinvestment plan (DRP) for any of these ASX ETFs will receive their new units shortly.

Here are the final distributions for investors receiving cash payments, and the DRP prices for those who are reinvesting their dividends.

Dividends for iShares ETFs

Own other ASX ETFs?

It's dividend season for several ASX ETF providers.

If you own Betashares ETFs such as Betashares Australia 200 ETF (ASX: A200) or Betashares Diversified All Growth ETF (ASX: DHHF), check your bank account today to ensure you received your dividend payment yesterday.

If you own Vanguard ETFs such as Vanguard Australian Shares Index ETF (ASX: VAS) or Vanguard Australian Shares High Yield ETF (ASX: VHY), you were also paid yesterday.

Follow the links provided above to find out how much your dividends or DRP unit prices were for this round of distributions.

The post Own ASX IOZ or other iShares ETFs? Here are the dividends you'll get today appeared first on The Motley Fool Australia.

BlackRock has announced the estimated distributions (dividends) for a range of its ASX iShares exchange-traded funds (ETFs).

The fund manager will pay investors on 21 April.

Dividends for iShares ASX ETFs

Here are the estimated dividends that investors will receive on 21 April.

The amounts will be finalised tomorrow, which is also the record date.

These iShares ETFs are trading ex-dividend today.

How is ASX IOZ performing?

The ASX IOZ aims to mirror the performance of the S&P/ASX 200 Accumulation Index, before fees and expenses.

The Accumulation Index is different to the S&P/ASX 200 Index (ASX: XJO) because it assumes the reinvestment of dividends.

Therefore, the index reflects total returns over a given period, whereas the benchmark ASX 200 Index only reflects capital gains.

This ETF provides an easy way to invest in the top 200 companies by market capitalisation on the ASX.

It includes exposure to the biggest ASX 200 banks and mining shares, which have traditionally paid some of the largest dividend yields.

They include the market's largest company, Commonwealth Bank of Australia (ASX: CBA), as well as BHP Group Ltd (ASX: BHP) shares.

Over the 12 months to 31 March, ASX IOZ returned 11.71% to investors.

The ETF's three-year average return is 9.47%. The five-year average return is 8.56%.

The management fee is 0.05%.

The post Own ASX IOZ or other iShares ETFs? Here is your next dividend appeared first on The Motley Fool Australia.

But not all income ETFs are created equal. Some focus on high yield, others prioritise consistency, and a few aim to actively boost income.

Here are 3 standout ASX ETFs that income investors should have on their radar right now.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This Vanguard fund is one of the most popular income ASX ETFs on the market — and for good reason. It focuses on high-dividend-paying Australian companies, delivering a strong yield with broad exposure across sectors like banks, miners, and telcos.

Its biggest strength is simplicity and scale, offering a diversified portfolio of around 80 companies with a low management fee of just 0.25%. Major holdings include BHP Group Ltd (ASX: BHP) and Commonwealth Bank of Australia (ASX: CBA), two of the ASX's most reliable dividend payers.

The trade-off? It's heavily weighted toward financials and resources, which can increase concentration risk.

BetaShares Australian Dividend Harvester Active ETF (ASX: HVST),

Next up is this BetaShares fund, which takes a more hands-on approach. Unlike index-tracking ETFs, HVST is actively managed and aims to deliver consistent income. It's even paying distributions monthly.

That makes it especially attractive for retirees or investors who want regular cash flow.

The ASX ETF typically holds 40 to 60 ASX shares, focusing on highly franked dividend payers. Key holdings often include National Australia Bank Ltd (ASX: NAB) and Wesfarmers Ltd (ASX: WES). The strength here is income consistency and active management.

The downside? Higher fees, around 0.72%, and the risk that active strategies don't always outperform.

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

Finally, the iShares S&P/ASX Dividend Opportunities ETF offers a slightly different flavour of income investing. This fund tracks an index of Australian companies expected to deliver above-average dividends, with a focus on sustainability and ESG screening.

Its management fee sits at around 0.23%, making it one of the cheaper options in the dividend ETF space.

Top holdings include Westpac Banking Corporation (ASX: WBC) and Fortescue Ltd (ASX: FMG). While its yield is typically lower than VHY, it offers a more balanced approach and slightly less concentration risk.

Foolish Takeaway

If you're chasing income in 2026, these ASX ETFs each bring something different to the table. VHY offers scale and strong yield, HVST targets consistent monthly income, and IHD delivers a lower-cost, diversified dividend strategy.

The right choice comes down to your goals — maximum yield, steady cash flow, or balanced income with lower fees.

The post 3 of the best ASX ETFs for income investors in 2026 appeared first on The Motley Fool Australia.

One option is to look for exposure to more defensive shares.

However another option is to start focussing on passive income rather than growth. 

In volatile markets, prices swing unpredictably. If you're focused on growth, your returns depend heavily on when you buy and sell.

With income investing:

• You're paid regardless of short-term price movements
• You don't need to sell assets in a downturn to generate cash. 

For example, if markets drop 20%, a growth investor may decide to sell at a loss.

A dividend investor can live off distributions and wait it out.

It's important to note that volatility doesn't mean you suddenly shift your entire portfolio. 

However, allocating some exposure to passive income may be worthwhile. 

One way to do this is through diversified dividend ASX ETFs. 

Here are three to consider. 

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This ASX ETF is one of the most popular passive income generating funds. 

It seeks to track the return of the FTSE Australia High Dividend Yield Index. 

Essentially, it targets stocks that have higher forecast dividends relative to other ASX-listed companies. 

Security diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% for any one company. 

Australian Real Estate Investment Trusts (A-REITS) are excluded from the index.

It currently provides a dividend yield of approximately 4%, paid quarterly. 

Betashares Australian Dividend Harvester Fund (ASX: HVST)

HVST ETF aims to provide franked income that exceeds the net income yield of the broad Australian sharemarket on an annual basis, along with exposure to a diversified portfolio of Australian shares.

The ETF's share portfolio is generally selected from the largest 100 Australian shares on the ASX, screened for high dividend and franking outcomes based upon expected future gross dividend payments.

The share portfolio is rebalanced approximately every three months, with the aim of including the shares that are expected, within the next rebalance period, to provide the highest gross yield outcomes.

It pays distributions monthly, and has a 12 month gross distribution yield of 7.0%. 

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

This ASX ETF includes roughly 50 ASX listed stocks that offer high dividend yields while meeting diversification, profitability and tradability requirements as well as being screened for sustainability considerations.

It also tracks an S&P/ASX ESG benchmark. 

According to iShares, it has a 12 month trailing yield of 4.32%. 

Distributions are paid quarterly. 

The post 3 of the best dividend ASX ETFs right now appeared first on The Motley Fool Australia.

By reinvesting those dividends early and letting compounding do the heavy lifting, investors can gradually build a portfolio capable of funding their lifestyle years before the traditional retirement age.

Here are 3 ASX dividend ETFs that could help you achieve that goal.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

This is the largest ASX dividend ETF on the Australian market and aims to track the FTSE Australia High Dividend Yield Index. It invests in around 70 Australian companies known for paying strong dividends. Major holdings include Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), and Telstra Group Ltd (ASX: TLS). 

The strength of this ASX ETF lies in its simplicity and scale. It focuses on large, established ASX companies with strong cash flows and consistent dividend histories. Many of these dividends come with valuable franking credits, which can boost after-tax income for Australian investors. The ETF also charges a relatively low management fee of around 0.25% per year. 

For investors targeting early retirement, VHY can form a solid income foundation. By reinvesting distributions over the years, investors can steadily grow their number of units and future income stream.

SPDR MSCI Australia Select High Dividend Yield ETF (ASX: SYI)

This fund screens the Australian market for companies with strong dividend yields and sustainable payouts. It holds around 40 to 60 companies and has one of the lowest management costs in the dividend ETF category at roughly 0.20%. The largest holdings are National Australia Bank Ltd (ASX: NAB), Macquarie Group Ltd (ASX: MQG), and Woodside Energy Group Ltd (ASX: WDS).

This ASX dividend ETF focuses on quality income. Instead of simply chasing the highest yield, it filters companies based on financial strength and dividend sustainability. That approach can help investors avoid so-called yield traps, where companies offer high dividends but struggle to maintain them.

For someone planning to retire at 57, that balance between yield and quality could prove valuable.

iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

This ASX dividend ETF holds around 50 high-yielding Australian companies and targets businesses with strong dividend profiles. Key holdings include BHP, Telstra, Rio Tinto Ltd (ASX: RIO), and Transurban Group (ASX: TCL). 

IHD provides exposure to many of the ASX's most reliable dividend payers while spreading risk across a broad group of companies. This diversification can help smooth income streams and reduce reliance on any single stock.

Foolish Takeaway

Sometimes, the path to early retirement doesn't require complex strategies. A simple portfolio of high-quality dividend ETFs, combined with patience and compounding, can do much of the heavy lifting.

The key advantage of combining these 3 ASX dividend ETFs is diversification. Instead of relying on just a handful of shares, investors gain exposure to dozens of dividend-paying companies across banks, miners, retailers, and infrastructure businesses. That diversification can help stabilise income even when certain sectors face challenges.

The post 3 ASX dividend ETFs that could help you retire at 57 appeared first on The Motley Fool Australia.

A handful of ASX ETFs now bundle the market's biggest dividend payers into a single trade. They offer instant diversification and regular income.

Three ASX ETFs stand out for investors chasing yield without abandoning long-term growth potential.

Let's take a closer look.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

Vanguard Australian Shares High Yield ETF has become a go-to option for dividend hunters. The ASX ETF targets Australian companies with above-average forecast yields, which naturally tilts it toward banks, miners and energy giants.

Heavyweights like Commonwealth Bank of Australia (ASX: CBA), National Australia Bank Ltd (ASX: NAB), BHP Group Ltd (ASX: BHP) and Woodside Energy Group Ltd (ASX: WDS) tend to sit near the top of the portfolio.

That concentration explains why distributions can look very attractive in strong commodity or banking cycles. The yield is typically well above the broader S&P/ASX 200 Index (ASX: XJO) and often boosted by franking credits. At the current share price of $82.65, the yield is 9%.

Growth isn't the main attraction, but over time capital returns have tracked the performance of Australia's largest blue chips. This makes it a classic income-first ETF with some upside attached. In the past 12 months, VHY ETF has grown by 8% at the time of writing.

Global X S&P/ASX 200 High Dividend ETF (ASX: ZYAU)

This smaller ASX ETF takes a slightly different approach. Instead of reaching deep into the market for yield, it stays closer to the ASX 200 and selects companies with strong dividend characteristics.

Banks still dominate, but infrastructure stocks, telcos and established industrials also feature prominently. That tends to smooth volatility compared with more aggressive high-yield strategies. Just 1.3% of the fund is invested in companies in the US and Europe.

The dividend yield is usually lower than the pure high-yield ETFs – 5.6% at current price levels – but investors get broader exposure to the market and a better balance between income and growth. For those who want dividends without drifting too far from the benchmark, this ETF sits in the middle ground.

iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD)

The iShares S&P/ASX Dividend Opportunities ESG Screened ETF adds a sustainability filter to the income equation. This $364 million ASX ETF focuses on a smaller group of higher-yielding Australian companies while excluding businesses that don't meet ESG criteria.

The result is a portfolio that still leans toward banks and established dividend payers, but with different sector weights to traditional high-yield funds. The dividend yield is generally more modest, offering 4.9% at the time of writing. Yet distributions are still competitive, and long-term returns aim to combine steady income with moderate capital growth.

This option appeals to investors who want attractive dividends without chasing the highest-yield. This ASX ETF was the best performing of the three ASX ETFs over the past 12 months, gaining 15% in value.

Foolish Takeaway

Together, these 3 ASX ETFs show there's more than one way to invest for income on the ASX.

Whether the priority is maximum yield, balance, or a blend of dividends and sustainability, dividend ASX ETFs can play a useful role in building passive income over time.

The post 3 ASX ETFs for investors chasing yield and growth appeared first on The Motley Fool Australia.

Those ETFs include iShares Core S&P/ASX 200 ETF (ASX: IOZ) and iShares S&P/ASX Small Ordinaries ETF (ASX: ISO).

IOZ ETF delivered a solid 10.36% return for 2025 in line with the strength of the benchmark S&P/ASX 200 Index (ASX: XJO) last year.

The ISO ETF outperformed, producing a 24.54% total return as ASX small-cap shares benefitted from three interest rate cuts.

Small-caps have market valuations of between a few hundred million dollars and $2 billion, and carry more debt to fund their growth.

Perpetual portfolio manager Alex Patten said 2025 represented the first time that small-caps had outperformed "in a number of years".

Patten said:

… now that rates are starting to come down, we're seeing more interest in small and micro caps and bit more liquidity in the market.

How much will ASX ETF investors receive today?

We have summarised the dividend amounts that investors will receive today, rounded to two decimal places.

The post Own IOZ or ISO ETFs? It's dividend payday for you! appeared first on The Motley Fool Australia.

Or perhaps iShares S&P/ASX 20 ETF (ASX: ILC) or iShares S&P/ASX Small Ordinaries ETF (ASX: ISO)?

BlackRock has just announced the estimated distributions (dividends) for its ASX iShares exchange-traded funds (ETFs).

BlackRock will pay its next round of dividends on 19 January.

If you own any of these ETFs and want to top up your holdings ahead of this round of payments, you'd better be quick.

The ex-dividend date is tomorrow.

How much will iShares ASX ETF investors receive?

Here are the estimated dividends that investors will receive on 19 January.

The amounts will be finalised on Thursday, which is the record date.

Prefer to reinvest your dividends?

A distribution reinvestment plan (DRP) is available for all of the ASX iShares ETFs above.

A DRP allows investors to reinvest their distributions automatically each time dividends are paid.

It's a helpful set-and-forget option for investors seeking compounding returns over the long term.

BlackRock will be accepting DRP elections up until 5pm today.

The post Own ASX IOZ or other iShares ETFs? Dividends just announced! appeared first on The Motley Fool Australia.

If so, we have exciting news for you!

BlackRock has just announced the estimated distributions for a range of its ASX iShares exchange-traded funds (ETFs).

Distributions is just another word for dividends. BlackRock will make the next round of payments on Wednesday, 22 October.

If you own any of these ETFs and want to top up your holdings ahead of the next distribution payment, you'd better be quick.

The ex-dividend date is tomorrow.

How much will iShares ASX ETF investors get?

Here are the estimated distributions for a range of ASX iShares ETFs.

Bear in mind that the amounts shown above are estimated distributions. BlackRock will advise us of the finalised figures on Monday.

Investors will receive their dividends on 22 October.

Want to reinvest your dividends?

A distribution reinvestment plan (DRP) is available for all of the ASX iShares ETFs above.

The DRP allows shareholders to reinvest their distributions automatically each time dividends are paid.

It's a helpful set-and-forget option for investors seeking compounding returns over the long term.

BlackRock will be accepting DRP elections up until 5pm today.

ASX IOZ share price snapshot

The IOZ ETF is trading at $36.43 per unit, up 0.5% on Thursday and up 9.2% over the past year.

ASX IOZ seeks to track the performance of the S&P/ASX 200 Accumulation Index, before fees and expenses.

The post Own ASX IOZ or other iShares ETFs? Here's your next dividend appeared first on The Motley Fool Australia.

In fact, data from S&P Global shows Australia has historically been one of the highest-yielding equity markets in the world. 

As of December 31, 2024, the trailing 12-month dividend yield of the S&P/ASX 300 Index (ASX: XKO) was 3.5%. 

This outpaces Europe (3.2%), Canada (2.8%), and the US (1.8%). 

Slow drop off

Despite Australia offering historically high yields, the last few years have seen a shift. 

In fact, the 3.5% trailing dividend at the end of 2024 is significantly lower than its long-term average of approximately 4.5% according to CommSec.

During the 10-year period between 2010 and 2019, close to 180 companies on average either maintained or increased dividends compared with the previous year. 

However, since 2021, there has been a moderate decrease in the number of companies that have increased dividends. 

As at the end of December 2024, 111 members of the ASX 300 Index pay fully franked dividends. 

How does this translate to investor income?

According to CommSec estimates, major Aussie companies classified in the S&P/ASX 200 Index (ASX: XJO) will pay out around $32.1 billion in dividends in the first five months of 2025, down 5.6% from last year's $34 billion.

Which sectors pay the best dividends?

Unsurprisingly, throughout the past 10 years, between 64% and 78% of the total dividend payments in the ASX 300 Index have come from the financials and materials sectors. 

A report from the ETF provider Betashares said as of the end of July 2025, 55% of all dividends paid out by the ASX 200 Index come from just ten companies. 

This concentration means that while franked dividends are still available, they are increasingly reliant on a small group of stocks, many of which are mature and cyclical.

Dividend darlings not immune 

According to Betashares, as earnings have been declining in parts of the Australian corporate sector, and company boards become more cautious given the uncertainty in the economy, there are arguably fewer companies that can afford to continue paying the high levels of fully franked dividends that investors have come to expect.

For example, BHP Group Ltd (ASX: BHP) recently declared a full-year dividend payout of US$1.10 per share.

The report from Betashares points out that while this is a fully franked figure, it is the lowest full-year payout since 2016/17 and follows a 26% decline in full-year profits. 

Another example is Woolworths Group Ltd (ASX: WOW), which recently cut its final dividend by 21%. 

Where to turn?

While this might all sound like doom and gloom, CommSec has helpful information on which sectors offer attractive yields. 

It lists energy shares, utilities, financials, consumer staples, and materials as sectors that offer the best yields. 

The Motley Fool is also always updating news and companies offering attractive yields here.

Furthermore, there are high-yield ASX ETFs that aim to provide investors with above-average dividend income. 

Some options to consider include: 

• Vanguard Australian Shares High Yield ETF (ASX: VHY)
• Betashares Australian Dividend Harvester Fund (ASX: HVST)
• iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD)

Foolish Takeaway 

While Australia still offers some of the highest yields amongst global markets, it is more important than ever for investors to research what yields are on offer. 

Investors should consider the history of a company's yields and pay attention to which direction this is trending. 

The post Why are ASX dividends shrinking? appeared first on The Motley Fool Australia.

The good news is that with discipline, smart investing, and time, that goal is achievable.

Step 1: Build a savings habit

The first step doesn't involve the sharemarket at all. It's about saving consistently. Even $500 a month invested regularly can snowball into a significant nest egg. This is where dollar-cost averaging (DCA) comes in — contributing steadily regardless of market conditions. By sticking to a schedule, you remove the temptation to time the market and benefit from buying through both highs and lows.

Step 2: Find the right investments

Not all investments are created equal. For those building towards a passive income target, the path usually begins with growth. Growth-focused ETFs, such as International growth ETF (ASX:GWTH) recently launched by VanEck, or broad-market options like BetaShares NASDAQ 100 ETF (ASX: NDQ), provide a simple way to compound wealth while staying diversified.

For investors comfortable with a core–satellite strategy, a core of ETFs can be paired with a few high-quality growth businesses that have strong competitive advantages and durable earnings power. These businesses won't always pay high dividends upfront, but their compounding potential can accelerate the journey towards a larger portfolio.

Step 3: Push through volatility

Markets never rise in a straight line. Periods of volatility are normal, sometimes even healthy. What separates successful long-term investors from the rest is the ability to stay invested and keep contributing through downturns. A disciplined savings plan, backed by dollar-cost averaging, ensures that volatility works in your favour rather than against you.

Step 4: Shift to income mode

Once your portfolio reaches scale, it's time to gradually rotate towards dividend payers. Income-focused ETFs, such as Vanguard High Yield (ASX: VHY) or iShares Dividend Opportunities (ASX: IHD), are designed to provide regular distributions.

At the stock level, reliable dividend growers in sectors like infrastructure, banking, or consumer staples can provide consistency. A portfolio yielding 5% on $1 million in assets equates to $50,000 a year in passive income. With franking credits, the effective income can be even higher.

Step 5: Stay the course

Building a second income stream isn't about chasing the next hot stock, it's about patience, compounding, and consistency. The maths is on your side. For instance, $6,000 saved and invested annually at an 8% return could grow into more than $300,000 over 20 years. That alone could provide $15,000 of annual passive income. Scale up the contributions, extend the timeframe, and $50,000 becomes realistic.

Foolish bottom line

Starting from zero, a $50,000 passive income target is ambitious but achievable. By saving regularly, investing in a mix of growth and income assets, and sticking through volatility, Australians can set themselves on a path to financial freedom. The journey won't happen overnight, but the compounding power of time and discipline makes it possible.

The post How to target a $50,000 passive income starting from zero appeared first on The Motley Fool Australia.

Passive income has become a financial goal for many Australians, and one of the most effective and accessible ways to generate it is through ASX dividend shares. Whether you're planning for retirement or just looking to boost your cash flow, the right strategy can get you there.

So, how much do you really need to earn $1,000 a month — or $12,000 a year — in dividends?

The $240,000 dividend portfolio

To generate $12,000 annually in dividends, you'll need a pretty sizeable portfolio.

Based on the assumption that a 5% dividend yield is achievable with relative ease, this means that a $240,000 investment portfolio will be required.

Of course, it is worth remembering that a 5% yield isn't guaranteed, but it is a reasonable target if you focus on quality dividend payers across sectors like financials, infrastructure, and consumer staples. And with franking credits on top, the after-tax yield could be even higher for some investors.

How to get there

If you don't have $240,000 lying around — don't worry, very few people do.

You can still work your way there over time.

Let's say you invest $1,000 a month into a portfolio of quality ASX shares or ASX ETFs, reinvesting any dividends, and earn an average return of 10% per annum.

If you achieved this, your investment portfolio would go from zero to the $240,000 mark in a touch over 11 years.

Increase your contributions, or achieve a slightly higher return, and you could hit that goal even sooner.

Choosing the right income assets

Here are a few ways to build a strong passive income portfolio on the ASX.

The first is individual ASX dividend shares. Look for companies with reliable cash flow, sustainable payout ratios, and a history of growing dividends. The likes of Telstra Group Ltd (ASX: TLS) and Accent Group Ltd (ASX: AX1) could be good examples of what to look for.

Another option is dividend-focused ASX ETFs. Funds like the Vanguard Australian Shares High Yield ETF (ASX: VHY) or iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) offer diversified access to high-yielding companies.

There are also Listed Investment Companies (LICS) to choose from. Some are known for consistent dividend payments and can be useful for income-focused investors.

Foolish takeaway

Earning $1,000 a month in passive income from ASX dividends isn't just a pipe dream — it's a realistic and achievable goal with a plan, patience, and a little compounding magic.

Whether you're starting with $10,000 or building your portfolio from scratch, the key is to stay consistent, focus on quality, and reinvest until you reach your target.

And once you're there, your dividends can keep working for you — month after month, year after year.

The post Want $1,000 a month in passive income? Here's how to get there with ASX dividends appeared first on The Motley Fool Australia.

But let's talk about some ASX exchange-traded funds (ETFs) that can say the same.

Alongside ASX 200 shares, there has been a huge swath of ETFs that have seen new 52-week highs this Thursday. We won't go over them all, but here are 12 of the most prominent funds to hit new high watermarks:

12 ASX ETFs at new 52-week highs today

Here are the 12 ETFs that have just clocked new 52-week highs this Thursday:

*at the time of writing

Why are these funds at new highs today?

As you can see above, we have a very healthy mix to discuss. Typically, when we see a bunch of ETFs hit new highs, they are correlated to a particular asset class or market.

When the US markets reach new records, for example, the funds that hold mostly or solely American stocks usually follow suit.

But today, it's different.

We have your standard ASX index funds like IOZ and ILC at new highs.

But we also have some thematic, global funds – HACK, ASIA, ROYL and GXAI – there too.

We have some index funds, too. IEU and F100 both track international markets, the United Kingdom and Europe, to be specific. It is interesting to note that the European markets are hitting new highs at the same time that the UK-based F100 is.

Here on the ASX, it's no surprise to see IOZ and ILC at new heights, given the new record that the ASX 200 Index hit this morning. That was helped enormously by Commonwealth Bank of Australia (ASX: CBA)'s new record high itself, alongside multi-year highs for Westpac Banking Corp (ASX: WBC) and National Australia Bank Ltd (ASX: NAB).

So a great day for ETF owners. Let's see what tomorrow brings.

The post 12 ASX ETFs at new 52-week highs this Thursday appeared first on The Motley Fool Australia.

Moomoo market strategist Jessica Amir has helpfully picked out the three most common ones and set out why they shouldn't stop you from buying stocks right now:

1. 'It's too hard'

This could be the most heard excuse for inaction, especially from those who have never bought ASX shares.

Amir argues that this might have been true in the old days when everything was done on paper through human brokers, but it's now 2024.

"Buying a share is as easy as buying groceries, whether it's a domestic stock or from overseas," she said.

"Nowadays, trading fees from brokerages like Moomoo can start from as little as $1, so there's little financial barrier to investing."

There are also plenty of free educational resources on the internet to get started, including a host of articles from The Motley Fool's Education Hub, so there's no excuse to not invest.

"So don't be afraid to take the first step — these days, it's usually a free one!"

2. 'Now isn't a good time to invest in the stock market'

We've all heard this investing myth before.

When stocks are down, the haters say this citing poor investor sentiment. When stocks are bullish, the critics say this because they think it's all too expensive.

So when is a good time to invest?

Amir reckons people are missing the point when they talk about 'good' and 'bad' times to buy shares.

"As the saying goes in the investing world, it's not about timing the market, but your time in the market.

"The best step to investing is a small one, even if it's just a hundred dollars you put towards investing into a highly diversified ETF."

Having said that, she added 2024 was looking bullish.

"The Australian and US share market are at an all-time high and there is plenty of exuberance in booming industries across the globe.

"Interest rates are easing up this year so it's likely we will see more consumer spending and investors trading, which helps support our share market."

Amir noted earnings generally declined last year.

"So it may be likely that shares will be bouncing back this year."

3. 'There's too much choice'

There is no satisfying some people. 

Would they rather that there are insufficient choices?

Amir suggests that investors don't have to complicate the situation by researching deep into microcaps.

There is nothing wrong with blue chip stocks to get started.

"The S&P/ASX 200 Index (ASX: XJO) and the S&P 500 Index (SP: .INX) are great places for new investors to start. 

"Not only are you exposed to some of the highest-performing stocks in the share market, but they are regularly managed to stimulate a profit."

Even amid the volatility last year, you would have done well with well-known large-cap names.

"If you had invested $10,000 into the S&P 500 at the start of January 2023, you would have made over $2,400 by December 2023."

Amir named iShares S&P/ASX Dividend Opp ESG Screened ETF (ASX: IHD), Russell Inv High Dividend Australian Shares ETF (ASX: RDV) and BHP Group Ltd (ASX: BHP) as some popular names to get started on the ASX.

"BHP continues to make the nation go round, supplying domestic and global products for building iron scaffolds, buildings, cars, and infrastructures.

"With a 5-year growth of 34.7%, it's no wonder it's an investment choice often made by superannuation funds, fund managers and sophisticated investors."

The post 3 popular investing myths BUSTED appeared first on The Motley Fool Australia.

So, let's take a look at which ETFs investing in Australian shares did best in 2023 based on total returns (that is, share price gains and dividend returns combined).

For the purposes of this article, we're focusing on ETFs that invest in Australian shares only, and with a defined investment strategy. That means we're excluding index-based and sector-based ETFs.

These rankings are based on data just released by the ASX.

The top 5 ASX ETFs for total returns in 2023

There is a clear theme among the best ETFs of last year — environmental, social, and corporate governance (ESG).

According to the data, here are the top five ETFs:

iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) returned 11.51% in share price growth and distributions over the 12 months of 2023.

iShares Core MSCI Australia ESG Leaders ETF (ASX: IESG) returned 10.73% in 2023.

Vanguard Ethically Conscious Australian Shares ETF (ASX: VETH) returned 9.98% in 2023.

Russell Investments Australian Responsible Investment ETF (ASX: RARI) returned 9.88% in 2023.

VanEck MSCI Australian Sustainable Equity ETF (ASX: GRNV) returned 9.83% in 2023.

EGS shares represent companies with good environmental, social, and governance credentials based on certain criteria.

In this era of climate change and decarbonisation, investors are increasingly seeking to support companies that are doing their bit to save the planet, so ESG stocks are becoming more popular.

More about the No. 1 ETF

According to ETF provider Blackrock, the iShares S&P/ASX Dividend Opportunities ESG Screened ETF invests in up to 50 ASX shares that offer high dividend yields and meet certain sustainability tests.

They also have to meet diversification, profitability and tradability requirements.

The IHD ETF closed at $13.88 per share on Thursday, up 0.58% for the day.

Among the top 10 holdings of the IHD ETF are major miners like BHP Group Ltd (ASX: BHP), big four banks including Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), Aurizon Holdings Ltd (ASX: AZJ), JB Hi-Fi Limited (ASX: JBH), and QBE Insurance Group Ltd (ASX: QBE).

The post Which ASX ETFs holding Aussie shares delivered the best returns in 2023? appeared first on The Motley Fool Australia.

Investors seem to love the diversification and simplicity that ETFs offer, all for what is usually a relatively cheap price (at least compared to what we used to pay managed funds).

As it stands today, simple index funds such as the Vanguard Australian Shares Index ETF (ASX: VAS) and the iShares S&P 500 ETF (ASX: IVV) are still the most popular ETFs on the ASX. But dividend ETFs have also been growing in popularity over the past few years.

How do ASX dividend ETFs work?

A dividend ETF works by selecting a basket of ASX shares that fulfil certain requirements when it comes to dividends. These requirements vary from fund to fund. But they generally include criteria such as a significant dividend yield (preferably with full franking credits attached), financial strength and stability, and a mature business generating plenty of cash flow.

Usually, these dividend ETFs hold fewer underlying shares than a full index fund. For example, the VAS and IVV ETFs named above generally hold around 300 and 500 individual companies respectively. But the Vanguard Australian Shares High Yield ETF (ASX: VHY) holds 75 at the latest count. The iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) has 49 holdings.

Some of the largest holdings in these two ETFs include shares like BHP Group Ltd (ASX: BHP), Commonwealth Bank of Australia (ASX: CBA), Rio Tinto Limited (ASX: RIO) and National Australia Bank Ltd (ASX: NAB).

Here are some of the prominent ASX dividend ETFs available on the markets today:

• Vanguard Australian Shares High Yield ETF (ASX: VHY)
• iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD)
• VanEck Morningstar Australian Moat Income ETF (ASX: DVDY)
• SPDR MSCI Australia Select High Dividend Yield Fund (ASX: SYI)
• BetaShares Australian Dividend Harvester Fund (ASX: HVST)
• Global X S&P/ASX 300 High Dividend ETF (ASX: ZYAU)
• BetaShares S&P 500 Yield Maximiser (ASX: UMAX)
• SPDR S&P Global Dividend Fund (ASX: WDIV)

Generally, these dividend ETFs offer higher dividend yields to ASX investors than what their equivalent index fund might provide. Typically, they also offer quarterly dividend payments (sometimes even monthly).

However, there are some things to watch out for if you go shopping for an ASX dividend ETF.

Things to watch out for when choosing an ASX dividend ETF

Dividend ETFs charge higher fees

If you're looking for the lowest-cost ETFs on the market, it's almost always pure index funds you'll end up with. Dividend ETFs normally charge higher fees for their tailored services. So make sure you compare the fees of an ETF you're looking at to see if they are worth the extra charges you might be asked to pay.

Performance

Although not a universal rule, many dividend ETFs sacrifice overall returns in order to boost the income yield you can expect from your investment. Now some investors who perhaps live off of their dividends might be okay with this.

However, others might not want to pay extra fees in order to get a lower overall return than they might get from an ordinary index fund. Thus, it might be a good idea to look at both short and long-term returns carefully when considering an income-focused fund.

Structure

Not all dividend ETFs are equal. Most out there will hold a basic portfolio of underlying shares in order to generate income. But others, including the BetaShares Australian Dividend Harvester Fund and the BetaShares S&P 500 Yield Maximiser Fund, use more complex derivatives to provide an income boost.

Make sure you understand how these work before investing, as these funds generally charge a higher management fee for this structure. It can also give their portfolios some different performance characteristics that investors should be aware of.

The post The rise of dividend ETFs in Australia: A new era of investment appeared first on The Motley Fool Australia.

This has led to the development of many exchange-traded funds (ETFs) and managed funds with environmental, social, and corporate governance (ESG) mandates.

These funds typically comprise ASX and international shares representing companies with strong ESG credentials.

The specifics of these credentials are determined by the providers who design the funds.

For example, a fund provider may only include international and ASX shares that represent businesses with defined net zero targets in their fund.

Regardless of the specific criteria, ESG-focused ASX shares investors enjoy feeling like they're doing their bit for sustainability and climate action.

And that's all well and good.

But how are these ESG-focused funds performing as investments?

A review of returns for ASX shares investors

In this article, we review new data published by the ASX that quantifies the returns of ETFs and managed funds with ESG credentials over the past three years.

Many of these funds are so new that three years of data is not available, so they have been excluded.

That leaves us with eight ETFs and managed funds with three years of data available.

Remember, these ASX-listed funds may invest in either ASX shares or international shares — or both.

Let's take a look.

Best-performing ASX sustainability shares

Over the past three years:

The BetaShares Global Sustainability Leaders ETF (ASX: ETHI) returned an average of 12.97% per annum. This includes reinvested dividends which have historically averaged a yield of 4.75%.

The Vanguard Ethically Conscious International Shares Index ETF (ASX: VESG) returned an average of 12.26% per annum. This includes reinvested dividends which have averaged a yield of 1.86%.

The Russell Investments Australian Responsible Investment ETF (ASX: RARI) returned an average of 11.02% per annum. This includes reinvested dividends which have averaged a yield of 3.94%.

The Intelligent Investor Ethical Share Fund (Managed Fund) (ASX: INES) returned an average of 10.57% per annum. This includes reinvested dividends which have averaged a yield of 0.91%.

The VanEck MSCI Australian Sustainable Equity ETF (ASX: GRNV) returned an average of 9.91% per annum. This includes reinvested dividends which have averaged a yield of 3.34%.

The iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD) returned an average of 9.89% per annum. This includes reinvested dividends which have averaged a yield of 5.14%.

The BetaShares Global Sustainability Leaders ETF — Currency Hedged (ASX: HETH) returned an average of 8.77% per annum. This includes reinvested dividends which have averaged a yield of 3.84%.

The BetaShares Australian Sustainability Leaders ETF (ASX: FAIR) returned an average of 5.53% per annum. This includes reinvested dividends which have averaged a yield of 2.12%.

A word on ASX ETHI shares

To give you an idea of how these ESG-focused funds work, let's do a quick profile on the top performing ASX share in this regard.

The BetaShares Global Sustainability Leaders ETF aims to track the performance of the Nasdaq Future Global Sustainability Leaders Index (INDEXNASDAQ: NQFGSL) (before fees and expenses).

The index includes a range of large companies identified as climate action leaders.

They operate in a range of industries and locations across the world.

Part of the criteria for inclusion in the index is that none of them have direct or significant exposure to fossil fuels.

Also, none are engaged in activities deemed inconsistent with responsible investment considerations.

About 32% of shares held within the ETHI ETF are global tech stocks.

The top holdings are NVIDIA Corp at 6%, Apple Inc at 4%, and Visa Inc at 4%.

How do the returns compare to index funds?

Let's use three Vanguard index fund products to compare the performance of the ASX sustainability shares listed above.

Are they delivering better returns for investors than plain old index funds?

Over the past three years:

The Vanguard US Total Market Shares Index ETF (ASX: VTS) returned an average of 15.37% per annum. This includes reinvested dividends which have historically averaged a yield of 1.28%.

The Vanguard MSCI Index International Shares ETF (ASX: VGS) returned an average of 13.62% per annum. This includes reinvested dividends which have averaged a yield of 1.87%.

The Vanguard Australian Shares Index ETF (ASX: VAS), which tracks the performance of the largest 300 ASX shares, returned an average of 12.32% per annum. This includes reinvested dividends which have averaged a yield of 4.07%.

As you can see, the ASX sustainability shares profiled above have typically delivered lower returns to ESG-focused investors than index funds.

The post Are ASX sustainability shares delivering for ESG investors? appeared first on The Motley Fool Australia.

But like all investing strategies, there is a right way to go about index investing, as well as a wrong way. So today, let's talk about three tips for picking the ASX's best index funds.

How to pick the best ASX index funds

Use index funds' diversification to your advantage

One of the top reasons investors opt for index funds is the inherent diversification they can provide. For example, a single investment in the Vanguard Australian Shares ETF represents an investment in the 300 largest companies on the ASX. That's everything from National Australia Bank Ltd (ASX: NAB) to JB Hi-Fi Ltd (ASX: JBH).

But why stop at just ASX shares? If you want true diversification in your portfolio, index funds are a great way of investing in some of the world's best companies, not just Australia's. Another popular index fund is the iShares S&P 500 ETF (ASX: IVV). This fund gives ASX investors exposure to the likes of Apple, Microsoft, Amazon, and Nvidia, all in one share.

You also get other famous American names that fall within the largest 500 companies in the US, including Exxon Mobil, Walmart, Coca-Cola, and Netflix.

You could even go outside the US if you so desired. The BetaShares Asia Technology Tigers ETF (ASX: ASIA) allows ASX investors to own some of the most exciting tech names in Asia, including names like Taiwan Semiconductor Manufacturing Co, Samsung, Tencent, and Alibaba.

Similarly, the Vanguard MSCI Index International Shares ETF (ASX: VGS) allows access to markets like Europe, the United Kingdom, Japan, and Singapore. It includes shares like Toyota, Nestle, and Unilever.

With just a handful of index funds, your share portfolio can have exposure to most of the world's best companies.

Compare different ETFs that offer similar services

There are now so many index funds available to invest in that you tend to find many providers competing for the same services. Want exposure to US shares? Well, there's the iShares S&P 500 ETF to consider, alongside the BetaShares NASDAQ 100 ETF (ASX: NDQ) and the Vanguard US Total Market Shares Index ETF (ASX: VTS).

On the ASX, the Vanguard Australian Shares Index ETF competes with the iShares Core S&P/ASX 200 ETF (ASX: IOZ) and the BetaShares Australia 200 ETF (ASX: A200) in offering investors an ASX-based index to invest in.

But while all of these funds are similar, they do differ slightly. For instance, Vanguard's VAS ETF allows ASX investors exposure to the top 300 companies in Australia. In contrast, both the IOZ and the A200 ETFs only give exposure to the largest 200 companies.

Choosing which you prefer comes down to an individual preference.

Another great example is the income-focused index funds offered by Vanguard and iShares. The Vanguard Australian Shares High Yield ETF (ASX: VHY) seems to be almost identical to the iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD). But the iShares fund screens out some companies using an ethical filter, while the Vanguard fund does not.

Again, some investors might not mind receiving income from oil stocks or alcohol producers. Others might.

Not all ETFs are created equal, even if they might seem to be at first glance.

Fees

One of the most important factors to consider with index funds is the fees they charge. Fees can eat into returns, and these losses compound over time. So it is of paramount importance that you pay the lowest fees that you can when choosing an ASX ETF.

Fortunately for ASX investors, fees have been on a downward trajectory for years now. But there are still some noticeable differences between ETFs that offer similar scope and services.

Take the BetaShares Australia 200 ETF and the SPDR S&P/ASX 200 Fund (ASX: STW). Both of these index funds track the S&P/ASX 200 Index (ASX: XJO) and offer exposure to the largest 200 companies on the ASX.

But the BetaShares ETF charges an annual fee of 0.04%, while the SPDR ETF will set an investor back 0.13% per annum.

Similarly, the NDQ ETF we discussed earlier charges investors a fee of 0.67% per annum, while the IVV index fund asks just 0.04%.

These differences might not seem significant. But they can make a large impact on an investor's returns if you plan on holding the fund for decades.

The post 3 tips for picking the best ASX index funds appeared first on The Motley Fool Australia.

There are your index funds, of course. The most popular of these are ASX ETFs, proving our local preference for Australian shares. But there are also index ETFs covering US shares, international markets, and emerging markets too.

Other ETFs, such as those covering specific sectors, trends, or commodities have also flourished. These days, you can invest in funds that track everything from global cybersecurity companies to oil futures, and gold or silver.

But which ETFs will continue to grow the most over the next few years?

ETF expert points to ethical and responsible investing

ETF provider BetaShares has some ideas about that. BetaShares is one of the ASX's most prolific purveyors of exchange-traded funds.

BetaShares' boss Alex Vynokur was asked about the future of the ETF sector in a report in The Australian this week.

Vynokur identified the ethical and responsible investing sector as the one he reckons will experience the largest growth rates over the next few years. Vynokur estimates that ethical and responsible ETFs are set to explode by $50 billion by late 2028, and even thinks they could hit $100 billion by the end of the decade.

As of 31 March, these ETFs reportedly accounted for $10.1 billion in funds under management (up from $3.5 billion in 2021).

That's despite the best-performing ETFs in recent months and years being those that focus on sectors like resources and energy.

Here's some of what Vynokur said:

There's no doubt the last 12 to 18 months have been volatile for investors… The reality is that investors increasingly recognise there is no need to sacrifice their investment objectives over the long term to build a portfolio that aligns with their values…

While younger investors are perhaps considered the poster child for adoption of ethical and responsible ETFs, we're now seeing increasing adoption from a broad range of Australian investors, including self-managed super funds.

Why are ASX investors flooding into ethical ETFs?

Vynokur identified three reasons for his optimism for ethical and responsible ETFs. He named the growing number of investors who wanted to "align their portfolio with their values while also meeting their investment objectives" for one.

Secondly, he pointed to "the cost-effectiveness" of using ETFs in order to pursue a responsible and values-aligned portfolio.

Thirdly, Vynokur argued that the "growing range of asset classes" that an ETF can provide investors access to is also driving interest in exchange-traded funds in pursuing ethical and responsible investing.

BetaShares currently offers eight ethical/responsible ETFs, including the BetaShares Global Sustainability Leaders ETF (ASX: ETHI) and the Ethical Diversified Growth ETF (ASX: DGGF).

Other ASX options in this space include the Vanguard Ethically Conscious Australian Shares ETF (ASX: VETH) and the iShares S&P/ASX Dividend Opportunities ESG Screened ETF (ASX: IHD).

So it will be interesting to plot the rise of ethical and responsible ETFs over the next few years to see if their growth conforms to Vynokur's strong predictions.

The post Betashares forecasts this ASX ETF sector to boom x5 by 2028 appeared first on The Motley Fool Australia.

There's a lot to like about ASX index funds like Vanguard's. Investors get broad diversification, and exposure to some of the country's best companies, and ASX index ETFs tend to be generous when it comes to dividend distributions too.

But speaking of dividends, the ASX is also home to several ETFs that purely focus on maximising dividend income for their investors.

These ETFs might not be as popular as index funds like the Vanguard Australian Shares ETF. But they still command a significant chunk of the market.

The ASX's dividend ETFs in focus

For example, the Vanguard Australian Shares High Yield ETF (ASX: VHY) has more than $4 billion in assets under management. Rather than investing in 200 or 300 shares like an index fund would, this ETF holds a far more concentrated portfolio of 73 shares (at its latest count).

It does this to focus on investing only in shares that pay out higher and more sustainable dividends compared to the broader market.

It's not the only ASX ETF that is built this way either. The ASX also houses the iShares S&P/ASX Dividend Opportunities ETF (ASX: IHD) and the SPDR MSCI Australia Select High Dividend Yield Fund (ASX: SYI), among a few others.

But are these ETFs really a better deal for those investors seeking dividend income? Well, that's what we'll be looking at today.

Well, let's start with the basics. So as of 28 February, the Vanguard Australian Shares ETF has returned 6.47% over the past 12 months, and an average of 8% per annum over the past three years. Over the past five, it has averaged 7.86% per annum.

This ETF has paid out four dividend distributions over the past 12 months, which come to an annual total of $6.36 per unit. That gives the Vanguard Australian Shares ETF a trailing yield of 7.25% on current pricing. This fund charges a management fee of 0.1% per annum.

Let's compare that to Vanguard's dividend-focused ETF.

Income or returns?

So Vanguard's High Yield ETF has returned 11.11% over the 12 months to 28 February. Over the past three years, it has averaged 11.53% per annum, and 8.55% per annum over the past five. This ETF pays out quarterly dividend distributions too.

On current prices, the past 12 months' total of $4.15 in distributions per unit gives this ETF a trailing yield of 6.26%. This fund charges a management fee of 0.25% per annum.

So, somewhat ironically, we can conclude that the Vanguard Australian Shares ETF offers a higher trailing yield right now than the Vanguard High Yield ETF. However, the High Yield ETF's overall performance (which assumes reinvested dividends) over one, three, and five years has been superior.

This doesn't carry over to some of the other dividend-focused ETFs on the ASX though. For example, the iShares Dividend Opportunities ETF has averaged 6.15% per annum over the past three years, and 4.6% per annum over the past five. It charges 0.23% per annum.

In the SPDR High Dividend Yield Fund's case, the story is different again. This ETF has given its investors a return of 8.08% over the 12 months to 28 February. Over three years, it has averaged 8.7% per annum, and 7.65% over five.

So when it comes to overall performance, Vanguard's High Yield ETF seems to take the crown over most other ASX income-focused ETFs. That includes Vanguard's own ASX 300 index fund.

Thus, we can conclude that investors would have been better off investing in this High Yield ETF over any period in recent history. But when it comes to raw dividend payments, Vanguard's Australian Shares ETF comes out on top. Go figure.

The post Is a dividend ETF really better than an ASX index fund for income? appeared first on The Motley Fool Australia.