Dividend ETF's

I mentioned briefly in my June Income post yesterday about the iShares UK Dividend Plus ETF tracker.

This was launched by Barclays in late 2005 and it holds the highest dividend yielding stocks from the FTSE 350. Dividends are paid quarterly and it's an excellent first holding for any equity income investor. The very low management charge of 0.2% is also highly appealing.

I hold some of these in my Income portfolio and in my Self Invested Personal Pension. They trade at NAV each day an they have been trading below £8 a share in the last week - compared to £13 a share a year ago.

BUT the dividends are rising - which is the reason for holding them in the first place. I am waiting for the June quarterly dividend to enter my ISA and SIPP cash balances. The dividend this year for the quarter is 20.04p compared to 17.31p in the same quarter last year. A healthy rise by anyone's standards I think!

So although the level of my capital investment has gone, the income received is going up. That's OK with me as I didn't buy the shares to make a quick buck. They are contributing to my goal of a sustainable and rising income.

For anyone looking for an easy way to kick start equity income investing these are worth a look. They do have a bias to financials as they are generating the greatest yields at the moment, so be prepared for more roller-coaster price movements - but with a healthy quarterly dividend boosting my coffers (they yielded 7.16% at Friday's close) I'm greatful to hold them. They are traded on the LSE with the ticker IUKD.

Disclosure: The Dividend Seeker holds iShares UK Dividend Plus shares.