HYG Dividend Yield ETF: A Comprehensive Guide

The HYG Dividend Yield ETF is a popular investment option for those seeking regular income. It's managed by BlackRock, one of the largest asset management companies in the world.

This ETF tracks the ICE BofA US High Yield Index, which is designed to measure the performance of high-yield bonds. The index includes over 3,000 bonds from more than 1,200 issuers.

Investors in the HYG ETF can expect to receive a significant portion of their investment back in the form of dividends. In fact, the ETF has a dividend yield of around 5-6%, which is higher than many other types of investments.

The high-yield bonds included in the HYG ETF are generally considered to be riskier than investment-grade bonds, but they also offer the potential for higher returns.

For your interest: Corporate High Yield Bonds

The HYG dividend yield is a significant factor to consider when investing in the High Yield Corporate Bond ETF. It currently stands at 5.44%.

The dividend yield is a key metric that indicates the income potential of the investment. HYG's yield is significantly higher than the category low of 0.00%.

To put this in perspective, the category high for dividend yield is 11.76%. This gives you an idea of the potential range of yields you could expect from similar investments.

HYG's dividend yield ranks 57.43% among its category peers. This suggests that HYG's yield is above average, but still within a reasonable range.

Here's a quick comparison of HYG's dividend yield to its category peers:

The iShares iBoxx $ High Yield Corporate Bond (HYG) ETF has a long history of providing attractive dividend yields to investors. Over the past 18 years, the actual dividend yield for investors who implemented the HYG ETF allocation has ranged from 4.08% to 13.79%.

Investors who started investing in HYG in 2007 would have received an actual dividend yield of 9.64% in 2007, 9.85% in 2008, and 8.46% in 2009. In contrast, investors who started investing in 2020 would have received an actual dividend yield of 4.96% in 2020, 4.26% in 2021, and 4.08% in 2022.

Here's a breakdown of the actual dividend yield for investors who started investing in HYG in different years:

Capital Growth is a crucial aspect of investing, and the iShares iBoxx $ High Yield Corporate Bond (HYG) ETF has consistently delivered impressive returns. The ETF's historical returns show a remarkable growth in capital value over the years.

In the table, you can see the cumulative dividend cashflow, which is the sum of all the dividends received, ranging from $131.51 in 2008 to $766.81 in Jan 2025. The portfolio value, excluding dividends, has also shown significant growth, from $722.52 in 2008 to $2337.73 in Jan 2025.

The Effective Return, which considers the received (and not reinvested) dividends, has been quite impressive, with a 36.75% return from Jan 2018 to Jan 2025. This is a testament to the power of dividend reinvestment in growing one's capital.

Here's a breakdown of the total returns for different periods:

As you can see, the total return with dividend reinvestment has been significantly higher than the portfolio return alone, demonstrating the importance of collecting dividends and reinvesting them to grow one's capital.

The yearly returns of this investment are a mixed bag. In 2009, the portfolio saw a significant gain of +28.57%, making it one of the best years on record.

The worst year was 2008, with a loss of -17.58%. This was largely due to the global financial crisis that year.

The portfolio's performance has been relatively consistent over the years, with only a few standout years. In 2016, the portfolio gained +13.41%, while in 2023, it gained +11.01%.

Here's a breakdown of the portfolio's yearly returns:

The years 2015 and 2022 were particularly tough, with losses of -5.03% and -10.99% respectively.

The iShares HYG High Yield Bond has a history of paying out dividends, with the most recent declaration being $0.3601 per share on January 31, 2025.

In the past year, HYG has paid a total of $4.70 per share, with a dividend yield of 5.90%. This means that for every dollar invested in HYG, investors can expect to earn around 5.90% in dividend payments.

For another approach, see: Jio Finance Share Dividend

The dividend is paid every month, with the last ex-dividend date being February 3, 2025. This suggests that investors who own HYG as of the close of business on February 2, 2025, are eligible to receive the next dividend payment.

The most recent dividend declarations show a range of $0.3601 to $0.4093 per share, with the highest payment being $0.4093 per share on December 17, 2024.

Expand your knowledge: Stock Buyback Yield

When managing a portfolio, it's essential to consider the fees associated with your investments.

High turnover in a mutual fund means higher trading fees for the fund manager, which can eat into your returns.

The HYG fund has a turnover of 19.00%, which is relatively high.

This high turnover results in higher trading fees, which are 19.00% of the fund's assets under management (AUM).

The category return for the HYG fund ranges from 1.00% to 255.00%, depending on the time frame.

In terms of ranking in its category, the HYG fund is at 2.36%.

Here's a breakdown of the HYG fund's fees and performance:

The actual dividend yield for long-term investors in the iShares iBoxx $ High Yield Corporate Bond (HYG) ETF has varied significantly over the years. For instance, if you had invested in January 2007, your actual dividend yield would have been 9.64% in 2020, 9.85% in 2021, and 8.46% in 2022.

Investing in January 2009 would have yielded a significantly higher dividend yield, with 11.46% in 2020, 11.71% in 2021, and 10.06% in 2022. The actual dividend yield has fluctuated over time, making it essential for investors to consider the long-term implications of their investment decisions.

In some years, the actual dividend yield has been lower than the initial investment period. For example, investing in January 2020 would have yielded a dividend yield of 4.96% in 2021, 4.26% in 2022, and 4.97% in 2023.

Here's a comparison of the actual dividend yield for the HYG ETF with its category peers:

This comparison shows that the HYG ETF's actual dividend yield of 5.44% ranks 57.43% among its category peers, with some peers offering much higher or lower dividend yields.