Motley Fool profiles three Fidelity ETFs for income: FDVV has a 2.63% 30-day SEC yield, FYEE a 9.16% distribution rate, and FIDI a 3.89% distribution yield. The funds use dividend stocks, covered calls and international holdings.
FDVV charges a 0.15% expense ratio and posted an annualized 13.2% return over the past decade, according to the article. Technology makes up nearly one-third of its portfolio, and technology plus financial stocks account for about half. FYEE has almost 200 holdings and sells covered calls, which cap upside. The article says most of its distributions come from options premiums and are taxed as ordinary income.
FIDI offers international exposure, with less than 2% of its assets in technology; six sectors each account for at least 10%, while real estate accounts for 9%. The article reports annualized returns of 12% over five years and 19.9% over three. It says FIDI does not use covered calls, so that strategy does not cap its upside and it has more favorable tax treatment.
