There are a large number of exchange-traded funds (ETFs) for income investors to choose from on the Australian share market.
But which ones could be good options in October? Let's take a look at three that could be worth considering this month. They are as follows:
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BetaShares S&P 500 Yield Maximiser (ASX: UMAX)
The first ASX ETF to look at is the BetaShares S&P 500 Yield Maximiser.
It has been created to give investors access to the top 500 companies listed on Wall Street. This includes many of the largest companies in the world such as Apple (NASDAQ: AAPL), Exxon Mobil (NYSE: XOM), Johnson & Johnson (NYSE: JNJ), and Walmart (NYSE: WMT).
BetaShares notes the UMAX aims to generate attractive quarterly income and reduce the volatility of portfolio returns by implementing an equity income investment strategy over this portfolio of stocks. It does not aim to track an index. This strategy means it has been able to provide investors with significantly better dividend yields than you would get by just investing in the 500 companies individually.
For example, its units currently trade with a trailing 4.6% distribution yield.
Betashares FTSE RAFI Australia 200 ETF (ASX: QOZ)
A second ASX ETF to look at is the FTSE RAFI Australia 200 ETF.
BetaShares recently recommended this ETF as a buy to counter falling dividend yields. It notes that it uses a fundamental indexing strategy which is designed to screen for stocks based on their merits rather than market capitalisation.
The ETF screens ASX companies using sales, cash flow, dividends, and book value. It then ranks and invests in these companies accordingly. This means that investors end up holding stocks that have healthier balance sheets and a greater capacity to pay dividends.
The Betashares FTSE RAFI Australia 200 ETF currently trades with a trailing dividend yield of 4.7%.
Vanguard Australian Shares High Yield ETF (ASX: VHY)
Finally, the Vanguard Australian Shares High Yield ETF could be another good option for income investors.
This popular fund gives investors access to a group of 60+ ASX dividend shares that brokers are forecasting to provide larger than average dividend yields.
At present, this means you will find companies such as ANZ Group Holdings Ltd (ASX: ANZ), BHP Group Ltd ASX: BHP), National Australia Bank Ltd (ASX: NAB), Telstra Group Ltd (ASX: TLS), and Wesfarmers Ltd (ASX: WES) included in the fund.
The Vanguard Australian Shares High Yield ETF currently trades with a trailing dividend yield of 4.85%.
