Evidence-Based Analysis

The Data on High-Yield ETFs Most Advisors Won't Show You

You know indexing works. But in drawdown, in retirement, in FIRE — cash flow matters. This guide applies the same evidence-based rigor you apply to your index core to the income satellite you're considering.

The Analytical Gaps in Most Dividend Advice

Total Return Is the Right Metric — Most Guides Ignore It

We analyze every ETF on total return: NAV change plus distributions reinvested. Yield without NAV context is marketing, not analysis.

Coverage Ratios Are the Key Variable Nobody Discusses

A fund paying more than it earns is mathematically unsustainable. Coverage ratios quantify this risk precisely — yet few retail resources cover them.

The Sequence-of-Returns Problem Indexing Doesn't Solve

In a 30-40 year retirement, sequence of returns risk is real. A dividend income stream that doesn't require share sales is a genuine structural advantage.

What's Inside

Chapters marked Most Relevant are specifically applicable to your situation.

1
The 5-Tier Risk SpectrumMost Relevant

A systematic framework for classifying any income ETF from Cornerstone (Tier 1) to High Octane (Tier 5).

2
Anatomy of a Yield TrapMost Relevant

The 6 structural signals that separate sustainable income from return-of-capital illusions.

3
NAV Erosion: The Math

How distributions exceeding earnings gradually destroy principal — with real ETF case studies.

4
Coverage Ratios ExplainedMost Relevant

How to read a fund's distribution coverage ratio and what thresholds signal danger.

5
10 Case Studies

Real ETFs analyzed: which ones are yield traps, which are sustainable, and why.

6
The 30-Second Audit Checklist

A printable checklist to evaluate any dividend ETF in under 30 seconds.

7
The 5-Step ETF Audit

A deep-dive due diligence process for any ETF you're considering adding to your portfolio.

8
Portfolio Construction

How to combine tiers for your specific income goal — conservative to aggressive allocation models.

36% Performance Spread

The gap between the top and bottom quartile high-yield ETFs over 3 years. Evidence-based fund selection matters — perhaps more than in the index universe.

Is This Guide Right for You?

This guide is for you if...

  • You're a data-driven investor who evaluates claims with evidence
  • You're in or near retirement and want to understand the income ETF landscape
  • You're open to a small income satellite alongside your index core — if the data supports it
  • You want to understand covered call ETFs, REITs, and BDCs before dismissing them
  • You've read Bernstein or Pfau and want the same rigor applied to income ETFs

This guide is NOT for you if...

  • You've decided categorically that dividend investing is suboptimal and won't reconsider
  • You're deep in accumulation with no income needs for 20+ years
  • You want confirmation bias, not analysis
  • You're looking for a simple buy list, not a framework

Apply Evidence-Based Rigor to Your Income Allocation

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