By Ian Salisbury

It's harder and harder to find U.S. stock-focused mutual funds that boast generous dividend yields. Fortunately, there are a handful of foreign and emerging markets funds that still offer payouts of 5% or more.

With the U.S. stock market dominated by growth-focused technology companies, the yield of the S&P 500 has shrunk to just 1.2%, its lowest levels since the early '90s-era dot-com bubble. The good news: It's relatively easy to find yields two to three times that level among developed and emerging markets stocks.

For most of 2026, overseas stocks have also outperformed. Shares of European and Asian companies were hit hard following the U.S. attack on Iran in late February, reflecting those regions' lack of domestic energy reserves. But they've snapped back on news of the tentative cease-fire. All-in-all the MSCI EAFE index of developed country stocks is up 5.5% year to date, compared with a decline of 0.3% for the S&P 500.

Some dividend funds are doing even better. The Global X SuperDividend ETF, an index fund targeting the 100 of the highest-yielding companies around the world, has returned 9.5% so far this year, according to Morningstar.

While a third of the fund's holdings are domestic U.S. stocks, it also has big investments in Brazil, Britain, Norway, and Bermuda. Top holdings include Thaifoods Group, which distributes poultry and other food stuffs in Thailand, and Brazilian energy companies PetroReconcavo and Petrobras.

The fund's dividend yield is an enticing 9.2%. But investors need to be wary. It's not necessarily a long term-holding. While the fund's year to date performance is impressive, it's proved volatile in the past. Over the past decade its average annual return is just 0.9%, ranking it at the very bottom -- the 100th percentile -- in its Morningstar category over the period.

Investors looking for an actively managed fund should check out the Voya International High Dividend Low Volatility Portfolio. The fund, which describes itself as a "fundamentally guided, quantitative-selection driven strategy" has returned 8.3% so far this year. Top holdings include blue chips like HSBC, Roche, and Shell.

Its 7.3% yield is slightly lower than Global X SuperDividend's. But its long-term performance is far better. The fund has posted average annual returns of 9.2% over the past decade, finishing more or less in the middle of the pack for its Morningstar category.

The First Trust Dow Jones Global Select Dividend Index ETF is another strong option. The fund is up 8.4% this year. Top holdings include Hyundai Elevator; Spanish telecom operator Telefónica; and oil and gas conglomerate OMV. The fund boasts a 5.4% yield and a 10-year average annual return of 10%.

Write to Ian Salisbury at ian.salisbury@barrons.com

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(END) Dow Jones Newswires

April 17, 2026 21:31 ET (01:31 GMT)

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