10-Year Treasuries Yield 5.3%; Schwab's Dividend ETF Yields 3.4%. Which One Should Income Investors Buy?
Locking in a high yield with Treasury bonds is becoming increasingly appealing.
Overview
Ten-year Treasury yields hit their highest level since 2002 at the start of the month. That's attracted a lot of attention from income investors. When you can receive a yield of around 5.3% guaranteed by the U.S. government after decades of extremely low interest rates, it's going to attract some attention.
Meanwhile, a soaring stock market means that, for the most part, dividend yields remain relatively low. The Schwab U.S. Dividend Equity ETF (NYSEMKT: SCHD), a favorite exchange-traded fund (ETF) among many income investors, sports a 30-day SEC yield of 3.4%.
Details
So, should income investors prefer Treasuries over the Schwab ETF right now? Here's what you need to consider.
Source
Originally published at www.fool.com.