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Alerian MLP ETF (AMLP) holds energy infrastructure MLPs that earn through fee-based long-term contracts. The ETF pays an 8.22% dividend yield.

Invesco KBW Premium Yield Equity REIT ETF (KBWY) offers a 9.77% monthly yield and trades near 2020 lows.

iShares Emerging Markets Dividend ETF (DVYE) provides 9.12% yield without options or leverage.

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Monthly dividend exchange-traded funds with extremely high yields (sometimes over 15%) have hit the market. However, it’s worth looking into ETFs like Alerian MLP ETF (NYSEARCA:AMLP), Invesco KBW Premium Yield Equity REIT ETF (NASDAQ:KBWY), and iShares Emerging Markets Dividend ETF (NYSEARCA:DVYE) if you want high yield without dealing with options.

On the surface, options ETFs like JPMorgan Nasdaq Equity Premium Income (NASDAQ:JEPQ) look like the best bet ever. You get a double-digit yield, and you get to partake in the upside. The latter makes them particularly attractive as traditional dividend ETFs like Schwab US Dividend Equity ETF (NYSEARCA:SCHD) have performed hideously since 2022.

That’s not to say that there aren’t better traditional dividend ETFs, but even their shareholders feel like they’re missing out once they see JEPQ investors cashing in triple the payouts while growing faster.

Unfortunately, there’s one caveat here. The mania of options ETFs is unlikely to last too long. These ETFs do give partial upside exposure, but the moment the market stops rallying, you’re in for a reality check. For example, ETFs writing covered calls for income are sacrificing exponential gains for linear income. It can get quite ugly when the market goes down, as you will absorb nearly all of the underlying index’s losses.

Worse, if something like a short-selling ban kicks in, like it did in 2008, it entails disastrous consequences for these ETFs. It’s unlikely, but that’s another layer of risk to keep in mind.

Taken together, I would diversify into some traditional high-yield dividend ETFs.

The Alerian MLP ETF gives you exposure to energy infrastructure Master Limited Partnerships (MLPs) in the U.S. It tracks the Alerian MLP Infrastructure Index (AMZI), which is a capped, float-adjusted, capitalization-weighted index of energy infrastructure companies.

Energy infrastructure companies may not look like the best bet at first glance due to energy prices being volatile. And when downturns hit, oil and gas prices can be among the worst hit. There’s no need to worry, though, as AMLP’s holdings mostly consist of energy transportation companies, with its top holding being a midstream business.

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