What the experts say

Hyped-up dividends

High-paying dividend stocks aren’t always what they seem, said Jack Hough in SmartMoney.com. Utilities in particular have a reputation for offering investors healthy cash payments: Stocks in that sector of the S&P 500 pay an average of $410 a year on a $10,000 investment, versus $220 for the broader market. But there’s an important catch that “many income investors won’t notice.” Utility companies often issue more stock than they repurchase, depressing the price of existing shares. That means they are “putting money in an investor’s left pocket and taking some out of his right one.” UBS stock strategist Jonathan Golub says that new share issues push average yields for the utility sector down to about $350 a year for those with a $10,000 investment. The broader S&P 500, by contrast, has been a net buyer of shares, making those shares more valuable. When those repurchases are considered, the broader S&P yields a more impressive $540 a year.

A risky ETF lookalike

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Exchange-traded notes, or ETNs, “are catching on fast,” said Penelope Wang in Money. But most investors may not realize how risky they can be. Like their “better-known sibling,” the exchange-traded fund (ETF), ETNs are portfolios of stocks, bonds, and other assets that you can buy and sell throughout the day. “Because they look similar to ETFs, many investors probably own ETNs without realizing the difference,” said Matt Hougan, editor of IndexUniverse.com, a website that tracks the sector. The big difference is risk: With ETNs, investors are buying an unsecured debt obligation, not an investment in a fund. That means fewer investor safeguards and often higher fees. Until ETNs “become more shareholder-friendly, steer clear.”

Unloading used smartphones

“All the smart kids are selling their old gadgets,” said Mickey Meece in The New York Times, and so should you. More than 278 million mobile devices sit idle or deactivated in the U.S., nearly half of them smartphones. That’s like letting cash sit neglected. To get an idea of what your device may be worth, check out trade-in sites like Swappa.com (for Android devices), Gazelle.com (for Apple products and other brands), or Glyde.com (for gadgets and games). When it’s time to sell, Gazelle, Amazon, NextWorth, and Glyde offer “free shipping and the ability to lock in prices.”