There aren’t many ASX income stocks left on the Australian share market with a dividend yield above 4%.
You can rule out Commonwealth Bank of Australia (ASX: CBA), Telstra Group Ltd (ASX: TLS), Coles Group Ltd (ASX: COL), Woolworths Group Ltd (ASX: WOW), Wesfarmers Ltd (ASX: WES), and many others.
Even fewer still yield 4% or more, and pay out monthly dividends. But let’s talk about one ASX income stock that ticks all of those boxes.
Well, technically, it is not a stock, but an exchange-traded fund (ETF). But income investors, don’t let that put you off the BetaShares S&P Australian Shares High Yield ETF (ASX: HYLD).
Like most ASX ETFs, HYLD allows investors to indirectly own a piece of an underlying portfolio of assets. In this case, this portfolio consists solely of other ASX income stocks â about 50 to be precise.
This portfolio concentrates on the highest-yielding sectors of the ASX, so investors shouldn’t be surprised to see that bank shares make up about 40% of HYLD’s weighted portfolio. But this ETF also holds ASX income stocks from other corners of the market, ranging from mining and energy to consumer staples and utilities.
At present, the income stocks that take up the most room in the Betashares Australian Shares High Yield ETF include BHP Group Ltd (ASX: BHP), ANZ Group Holdings Ltd (ASX: ANZ), Macquarie Group Ltd (ASX: MQG), Rio Tinto Ltd (ASX: RIO), and Transurban Group (ASX: TCL).
But let’s talk about what kind of income this stock could provide.
An ASX monthly income stock with a 4.2% yield?
The HYLD ETF has only been around on the ASX for a relatively short period of time. It first floated on the ASX back in August of last year.
Since then, this fund has doled out ten dividend distributions on its monthly pay schedule. The last four of these payments were worth 11.7 cents per unit each. The first six came in at 11.9 cents.
If we annualise the former metric, just to be conservative, we get a figure of $1.40 per unit in dividend distributions. At the current HYLD unit price, that gives this ASX income stock a trailing yield of 4.21%. Due to the varied nature of the portfolio, these dividend distributions usually come partially franked at varying degrees.
Now, as with any ASX dividend stock, we shouldn’t assume this is the yield one can expect going forward. However, we can say that, given the nature of HYLD’s portfolio, the yield from this stock should continue to come in at the upper end of what the broader ASX is offering.
As such, I think the Betashares Australian Shares High Yield ETF is an income investment well worth considering for any dividend seeker in 2026.
The post This ASX income stock has a 4.2% yield and pays out monthly dividends appeared first on The Motley Fool Australia.
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Motley Fool contributor Sebastian Bowen has positions in Wesfarmers. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Macquarie Group, Transurban Group, and Wesfarmers. The Motley Fool Australia has positions in and has recommended Telstra Group and Transurban Group. The Motley Fool Australia has recommended BHP Group, Macquarie Group, and Wesfarmers. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.