Want to earn $500 a year from stock dividends? This ETF can be referenced.

The average Dividend yield of the SPDR S&P 500 Dividend ETF (SDY) over the past 12 months is 2.56%. Based on this yield, at the current price of $136, you would need to purchase approximately 144 shares to earn 50,000 cents annually.

The advantage of this ETF lies in its strict stock selection criteria: only companies that have increased their dividends for 20 consecutive years are eligible. This means you won't fall into the trap of stocks that appear to have high dividends but are actually pitfalls.

Currently, SDY includes 149 stocks, covering all 11 major economic sectors of the US stock market. Among them, industrial stocks have the highest proportion (18.9%), followed by consumer staples (17.74%) and utilities (15%). These industries naturally have stable cash flows and are more generous to shareholders.

Dividends may fluctuate due to the different dividend payment times of the holding companies, but historically, SDY's yield has generally been able to outperform the S&P 500.