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Dear Fellow Investor,
Three of the Top Dividend ETFs to Hold for 10 Years
Economic and geopolitical uncertainties have made markets more volatile, and many investors are feeling it in day-to-day price action. When headlines move faster than fundamentals, it becomes harder to rely on short-term forecasts or timing trades.
That is exactly why dividend investing remains a durable long-term strategy.
A portfolio anchored by dividend-paying companies and income-focused ETFs can help in three ways:
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Cash flow you can use or reinvest. Regular distributions can fund expenses, rebalance a portfolio, or compound returns through reinvestment.
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Potential downside support. High-quality dividend payers are often profitable, mature businesses with resilient balance sheets—traits that can hold up better in choppy markets.
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A disciplined framework. When you hold investments for the income stream, you are less likely to overreact to every macro headline.
Of course, not all “dividend” strategies are created equal. Some focus on dividend growth and quality. Others use options overlays to manufacture yield. And some pursue very high payouts that come with higher credit, leverage, or sector concentration risk.
Below are three dividend ETFs with distinctly different approaches—each worth consideration for a 10-year holding period depending on your objectives, risk tolerance, and portfolio design.
ETF: Amplify CWP Enhanced Dividend Income ETF (SYM: DIVO)
If your primary goal is steady monthly income with a quality tilt, DIVO is structured to fit that mandate.
With a monthly yield of 1.7% and an expense ratio of 0.56%, the Amplify CWP Enhanced Dividend Income ETF holds large-cap companies with a strong history of dividend growth. In addition, it uses a covered call strategy on individual stocks—an approach designed to generate option premium income while still maintaining exposure to equity upside (though typically less upside in strong bull markets).
As the issuer explains: “DIVO seeks investment results that correspond generally to an existing strategy called the Enhanced Dividend Income Portfolio (EDIP).” The strategy attempts to generate income through dividends and short-term covered calls in an effort to increase cash flow and provide more consistent annual income. In practice, EDIP emphasizes blue-chip stocks drawn from widely followed benchmarks like the S&P 500, the Dow 30, and the S&P 100.
Why DIVO can work in a long-term portfolio
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Quality exposure: Blue-chip companies with dividend growth tendencies can offer more resilience than pure high-yield approaches.
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Income smoothing: The covered call overlay can create a “cash flow engine” during sideways markets.
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Behavioral advantage: Monthly distributions can reduce the temptation to make reactive portfolio decisions.
Key risks to understand
Bottom line: DIVO can serve as a core income holding for investors who prioritize stability and consistency over maximum upside.
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ETF: JPMorgan Nasdaq Equity Premium Income ETF (SYM: JEPQ)
For investors who want higher income potential while still maintaining exposure to large-cap growth, JEPQ is a common tool.
With a yield of 11.2% and an expense ratio of 0.35%, the JPMorgan Nasdaq Equity Premium Income ETF generates income primarily by selling options while investing in U.S. large-cap growth stocks. The concept is straightforward: options premiums can be harvested to support a monthly income stream, and the equity sleeve provides participation in long-term growth trends.
Investors have also benefited from the ETF’s appreciation, which is an important point: high yield alone is not helpful if principal erodes over time.
Why JEPQ can fit a 10-year plan
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Income plus growth exposure: Provides a way to earn yield from growth-heavy equities that do not always pay large dividends.
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Monthly cash flow: Options premiums tend to be distributed regularly.
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Potential volatility buffer: Option income can offset some drawdowns, especially in range-bound markets.
Key risks to understand
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Still equity risk: If large-cap growth sells off sharply, JEPQ can fall meaningfully.
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Upside trade-off: Like any option-income strategy, the structure often sacrifices some upside during powerful bull runs.
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Yield variability: Options income can fluctuate with market volatility; distributions are not guaranteed.
Bottom line: JEPQ can be a strong income overlay for investors who want growth exposure but prefer to convert some of that volatility into cash flow.
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ETF: Invesco KBW High Dividend Yield Financial ETF (SYM: KBWD)
If your objective is maximum yield, KBWD is designed to deliver it—while concentrating in financial and yield-sensitive names.
With an expense ratio of 0.35%, the Invesco KBW High Dividend Yield Financial ETF has a monthly yield of 12.56%. The fund recently paid dividends of just over $0.14 per share on September 26, August 22, and July 25, illustrating how consistently it has been distributing cash.
KBWD can pay such a substantial dividend because it invests at least 90% of its assets in financial stocks with competitive yields. Its holdings include names such as Orchid Island Capital, Invesco Mortgage Capital, ARMOUR Residential REIT, AGNC Investment, and Annaly Capital, among its 42 active holdings.
Why KBWD can be compelling
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High monthly income: For investors who need cash flow now, KBWD is designed for yield.
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Targeted exposure: Provides a concentrated allocation to yield-heavy financial segments.
Key risks to understand (especially for a 10-year hold)
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Sector concentration: Heavy exposure to financials and mortgage REIT-type structures can amplify drawdowns in rate shocks or credit stress.
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Distribution sustainability: Very high yields often reflect higher risk. Payouts can be reduced in adverse environments.
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Interest-rate sensitivity: Many holdings can be highly sensitive to funding costs, spread compression, and refinancing cycles.
Bottom line: KBWD can be a satellite income position—but most investors should avoid treating it as a “set it and forget it” core holding without understanding the rate/credit dynamics underneath the yield.
How to use these ETFs together (a practical framework)
If you are building a 10-year income sleeve, consider aligning each ETF to a role:
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Core stability and quality: DIVO (lower yield, higher quality bias, smoother income profile)
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Income from growth exposure: JEPQ (turns volatility into monthly distributions)
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High-octane yield satellite: KBWD (highest yield, highest concentration and sensitivity risk)
That structure can help avoid a common mistake: reaching for maximum yield across the entire income allocation, which can leave a portfolio overexposed to a single macro regime.
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Are there any other dividend stocks or ETFs you swear by? What other sectors of the market are you currently interested in? Hit "reply" to this email and let us know your thoughts!
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