A lot of income investors get tripped up on something basic: the difference between a dividend and a distribution. People use the terms interchangeably, but they are not the same thing.
A dividend is a payment made by a company to its shareholders, typically out of its profits. A distribution, on the other hand, is a payout from an investment fund like an ETF, and the underlying sources can vary quite a bit. A distribution can include dividends, but it can also include ordinary income, short- or long-term capital gains, and even return of capital.
For investors who prefer a more traditional, plain-vanilla approach, the good news is those ETFs still exist. They tend to be lower cost, easier to understand, and less reliant on complex strategies.
The trade-off is that the yield is usually lower, but total return still matters more. With that in mind, here are two dividend-focused ETFs that pay monthly instead of quarterly.