The ‘Sleep-Well-At-Night’ Portfolio: Monthly Income With Near-Zero Drama

With the NASDAQ 100 at a new all-time high and the S&P 500 challenging its record high, it’s getting easier for investors to sleep at night. That said, for those who were kept up at night this spring with President Trump’s tariff rhetoric in the lead-up to so-called Liberation Day — and the ensuing fallout in stock prices — I do think that it’s still worth considering some of the more defensive value names out there.

Like it or not, a “tech winter” and market-wide correction will happen again, eventually, as part of natural market cycles. And it may not be met with a timely V-shaped recovery like the one we’ve been treated to since the market bottomed out back in April. In this piece, 24/7 Wall St. looks at a few monthly income plays that can help investors sleep soundly, even if tariffs, geopolitical tensions, the Fed or other concerns continue to weigh more heavily on investor sentiment as we enter the second half of 2025.

So, if you’re in the market for a so-called SWAN (sleep well at night) portfolio, which has picked up traction with some Reddit posters on the r/dividends subreddit, the following two exchange-traded funds (ETFs) may be of interest to you.

Key Points in This Article:

• SPHD offers a dividend currently yielding 3.44% and an attractive forward P/E multiple.
• BND offers a dividend currently yielding 3.75% and an exceptionally low expense ratio. 
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Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)

Invesco S&P 500 High Dividend Low Volatility ETF (NYSEARCA:SPHD) is a fantastic way for passive investors to get a higher yield than the S&P 500 and a lower degree of volatility. Indeed, whenever you have fatter dividends and a lower correlation to the rest of the market, you have a stock that can be relied upon when stocks collectively fly south. With a below-average beta of 0.77 and an above-average yield of 3.44%, there’s a lot to love about the low-cost ETF, which, I think, is incredibly underrated.

What kind of stocks and REITs comprise the SCHD ETF? The REITs, utilities, and consumer staples comprise close to 55% of the portfolio. Indeed, these are sectors that tend to naturally sport lower betas and higher yields. With names such as Crown Castle (NYSE:CCI) and Verizon (NYSE:VZ) among the top holdings (I’ve praised both dividend plays in prior pieces), I do view the defensive ETF as a fine choice for those looking to construct a “SWAN” portfolio while the price of admission is cheap, with the SCHD shares only recently falling into correction territory.

Finally, the SCHD has a very reasonable 14.7 times forward price-to-earnings (P/E) multiple, making it magnitudes cheaper than the S&P 500. Though the management fee of 0.30% is higher than your run-of-the-mill S&P 500 ETF, I think the slightly higher fee is worth paying up for, given the unique exposure you’ll get and the likely limited downside come the next market-wide spill.

Vanguard Total Bond Market Index Fund (BND)

If you really want a great night’s rest, adding some bond exposure to your portfolio may be a good idea. The Vanguard Total Bond Market Index Fund (NASDAQ:BND) is a go-to for those who want simplicity and broad diversification across the investment-grade U.S. bond market. With a monthly payout and a rock-bottom expense ratio (0.03%), the BND is an easy buy for those looking to beef up the bond portion of their portfolio.

At the time of this writing, the BND sports a 3.75% yield, which is pretty standard these days. For investors seeking to minimize fees and spread bets across a wide range of maturities, perhaps there is no better one-stop shop to pick up for the summer. While the BND won’t juice your returns, it can help you worry less about your portfolio once the stock market encounters its next big rough patch.

As always, younger investors, even those who are easily started, should have a preference for stocks over bonds. Either way, a small amount in bonds, cash and even CDs is never a bad idea, especially for those who have a lower tolerance for risk.

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