With the yield for 10-year Treasury note falling to 2.60%, from above 3% at the start of the year, we think investors are increasingly looking for alternative income investments. Fortunately there are also a lot more dividend-paying stocks and ETFs to choose from.

According to S&P Dow Jones Indices, which operates independently from S&P Capital IQ, there have been 225 dividend increases in the S&P 500 as of mid-June, with 217 unique issues. There are now 422 companies that pay a cash dividend, up from 418 at year end. From a sector perspective, Telecom Services and Utilities stocks such AT&T (T 35 ****) and Southern (SO 44 ***) offer the highest yields. However, relative to the end of 2012, there are five more Consumer Discretionary constituents, five more Energy constituents and five more Industrial constituents now paying a dividend. General Motors (GM 37 *****) and Allegion (ALLE 58 ***) are two such examples. From a yield perspective, T, SO and GM, offering respective 5.2%, 4.8% and 3.3% dividend yields that are much higher than the yield of S&P 500 Index, while ALLE's 0.6% is below average.

There are dividend opportunities across a range of sectors, and we have not even touched on Consumer Staples or Health Care, which investors have long associated with dividend increases. As such, investors have been increasingly using diversified, mostly low-cost ETFs to gain exposure to the dividend theme. However, because they seek to track indices that are constructed differently, the sector exposure and not surprisingly the performance of some of these ETFs can be starkly different.

This week, S&P Capital IQ ETF Research updated its ETF classification system, shifting to a prospectus-driven approach, based on 40 different attributes, from a legacy holdings-driven approach. The approach is now reflected in the screening tools on MarketScope Advisor and is incorporated in the highest-scoring ETFs by asset class grouping (page 4) of the ETF reports. In addition to some peer group shifts among ETFs, such as from large-cap growth to large-cap core, one of the new classifications investors can find is dividends. There are now 31 U.S. dividend style ETFs.

The largest of these dividend focused ETFs, Vanguard Dividend Appreciation Index ETF (VIG 78 Overweight), holds companies that have raised their dividend in every year for at least the last 10 years. Year to date through June 23, the ETF rose 4.8%, lagging the S&P 500 Index's 7.2%, but it has a three-year beta of 0.87. VIG's largest sector exposures are in Consumer Staples (22% of assets), Industrials (21%) and Information Technology (12%), with a combined 1% in Telecom Services and Utilities. The ETF, which ranks favorably on a range of inputs to us at S&P Capital IQ's ETF Research including the appeal of its holdings. However, the 12-month yield is only 1.9%.

For investors seeking another higher income generation, another popular one is iShares Core High Dividend Select Dividend ETF (HDV 76 Overweight), with a 3% 12-month yield. DVY was up 9.5% this year and is constructed quite differently than VIG. The focus is not just on dividend growth but rather financial health. From a sector perspective there's more of a defensive slant with Utilities as the third largest (13% of assets). This is behind Consumer Staples (26%) and Health Care (20%). Meanwhile, Financials make up just 1% of the ETF. Not surprisingly, the beta is much lower than VIG at 0.49.

Performing in between HDV and VIG this year is WisdomTree Total Dividend (DTD 72 Overweight), up 8.1%. The ETF yields 2.3% and has a beta of 0.82. DTD is more diversified at the sector level than the two other ETFs, with Financials (18% of assets), Information Technology (15%) and Consumer Staples (13%) the most represented.

The good news for U.S. dividend-focused investors is there are a lot of fundamentally strong securities to choose from. However, these notable differences between them highlight how the tools on this platform from S&P Capital IQ can help. We encourage you to review the respective ETF reports for further details and to use the updated ETF screener to sort through the universe.