Fidelity's High-Yield ETFs Combine Dividends and Diversification

Fidelity offers three exchange-traded funds (ETFs) that combine high yields with portfolio diversification. The Fidelity High Dividend ETF focuses on large-cap and mid-cap companies expected to maintain or grow their dividends over time.

With a 2.63% 30-day SEC yield, the fund can remain competitive with key benchmarks such as the S&P 500. Its top holdings include dividend-paying hyperscalers like Nvidia, Apple, and Microsoft, as well as higher-yield picks like JPMorgan Chase, Coca-Cola, Best Buy, and Philip Morris.

The Fidelity Yield Enhanced Equity ETF invests in large-cap stocks that are in the S&P 500 and sells covered calls to generate higher yields. This approach explains why the fund has a 9.16% distribution rate despite having low- or no-yield stocks in its top 10 holdings.

The Fidelity International High Dividend ETF offers global diversification by prioritizing international companies with a high likelihood of raising dividends each year. With a 3.89% distribution yield and less than 2% of assets in tech, this fund provides true diversification across multiple industries.