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Dave Nadig
3:00
Good afternoon!
Welcome to ETF.com Live! As always, you can ask your questions below, and I'll keep answering till you run out of questions, or my hands fall off.
We'll post a transcript up at the end of the day.
3:01
With that's let's get rolling.
Brandon
3:01
Hi Mr. Nadig. I'm a young investor looking for an etf with a high yield. Preferably something in the fidelity or ishares family because I don't have to pay a commission on these. Thanks!
Dave Nadig
3:01
Hi Brandon, so, I'll use this as a teach-a-man-to-fish moment.
You can use our ETF Finder to get at exactly this.
Here's a screen of Equity ETFs that call themselves "high dividend yield"
3:02
from there, on the tabs below, you can go to "Fundamentals"
and you can sort by actual yield there.
So that would suggest that the Global X Superdividend ETF (SDIV) is pretty well named, at a 7.16% yield.
3:03
if you want to go to just an iShare sund, you hit the DVYA ETF, which is only asia/pac stocks, at 5.41%
and here's where I make the big caution:
if you're chasing dividend yield only, you're going to end up with all sorts of compromises in your exposure.
3:04
SDIV, for example, is a perfectly fine fund, but it loads up australia and UK stocks pretty heavily
And is LOADED with financials, almost 65%.
so just know when yo make that kind of call, there are tradeoffs.
SR
3:04
For senior loan ETFs, do they rely on credit facilities to help with large redemption orders?  Aside from cash creates/redeems, is there anything else these issuers can do to alleviate settlement problems?
Dave Nadig
3:05
Nailed it in one -- yes, pretty much all ETFs have a line of credit to deal with any issues -- but there's no magic in the ETF wrapper.
When you are dealing with illiquid underlyings, the ETF wrapper just creates a pass through for pressure.
3:06
So, if everyone wants out, the ETF will trade down a lot.  And in something less liquid like junk bonds or loans, that can show up as a disconnect
between the trading price and the NAV.
In this case, I'd argue, that's the right price, and essentially nobody is actually transacting at NAV.
3:07
There's legitimate discussion amongst ETF wonks about whether the settlement issues in some securities make them less obvious as targets for an ETF strategy
and certainly some folks criticised the loan ETFs for that -- but in general, they're doing what they say on the tin.
great question though.
Todd Rosenbluth - CFRA research
3:07
During the video you and I did at inside smart beta conference (available today on etf.com) we talked about of investors aim to time factors they better really have conviction since they could be wrong for a while. Given its eps season what do you think of using  ETFs to protect mistiming stocks. QQQs vs Netflix or Amazon.
Dave Nadig
3:08
Hey Todd --
In general, I think market timing is a mugs game, whether you're using ETFs to do it or whether you're buying individual stocks.
If you're an investor who's really focussed on things like earnigns season, I think it's reasonable to ask "well, what stocks are you buying."
3:09
The goofiest question I always get is "how to play X stock with an ETF."
The answer is ALWAYS "well, just play the stock."
So if you are going to play Amazon earnings one way or the other, you should just buy or short Amazon stock, and know that's pure speculative trading.
3:10
If you're worried (or excited) about, say, the whole tech sector, then by all means, start looking for ETFs that match that conviction
I'd argue QQQ is probably not the best way to do it, as it's hardly a pureplay on tech, and misses out on plenty of great stocks that don't happen to be on the Nasdaq.
3:11
And I'll push our new tool - the stock finder - which can help point out that, for instance, XLY has the biggest allocation to Amazon,
Ken
3:11
To minimize my taxes, I'm searching for a broadly diversified ETF which issues little or no dividends.  I know this is often the case with tech ETFs,  but is there a more diversified ETF that is somehow structured to minimize dividends?  Thank you.
Dave Nadig
3:11
Hi Ken!
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