What is a dividend ETF?

Dividend ETFs target stocks that pay dividends, but the selection rules vary. Some focus on high yield, others on dividend growth, and others screen for quality and payout sustainability.

Dividend strategies can change your sector exposure. High-yield dividend funds may tilt toward sectors like financials, utilities, or energy, while dividend-growth funds may look different.

If you're using dividend ETFs for income, look beyond yield. Check payout stability, sector concentration, and total return, because a high yield can sometimes signal higher risk rather than a "better" income stream.