On Aug. 9, the Federal Open Market Committee (FOMC) moved to quell market fears. In response to Standard & Poor’s downgrade of US credit and a growing debt crisis in Europe, the FOMC announced that the federal funds rate would likely remain at “exceptionally low levels” though mid-2012, if not longer. Although the announcement helped stabilize equity markets, Treasury yields have compressed and the yield curve is now about the flattest it’s been since the 2008 financial crisis.

The move has left income investors between a rock and a hard place; yield has been elusive during the past few years and the Fed’s announcement will only make the situation more difficult for income-seeking investors.  Thankfully, several exchange-traded funds (ETF) can meet their needs.

Master limited partnerships (MLP) offer attractive yields and have become extremely popular with investors. The majority of the cash flows that MLPs generate are passed on to investors in the form of quarterly distributions. These quarterly distributions include a portion that’s known as “return of capital,” a payment that reduces your cost basis and isn’t taxed until you sell your investment.

Many MLPs own attractive, fee-generating assets in the pipeline business. Not only are these MLPs an excellent play on growing demand for energy, they’re cushioned from volatile commodity prices.

JP Morgan Alerian MLP Index ETN (NYSE: AMJ), an exchange-traded note (ETN), tracks the Alerian MLP Index, a capitalization-weighted index comprising the 50 largest publicly traded energy MLPs. The ETN is broadly diversified across the investable MLP universe and its ETN structure allows it to track the index almost tick-for-tick with very little tracking error. JP Morgan Alerian MLP Index ETN sports a reasonable annual expense ratio of 0.85 percent and a huge 5.1 percent yield paid out quarterly. Owning an MLP via an exchange-traded product doesn’t convey any particular tax advantage to fund holders. But MLPs pay low corporate taxes, which allows investors to enjoy higher yields.

SPDR S&P Dividend (NYSE: SDY) is another attractive option in a low-yield environment. The fund tracks the S&P High Yield Dividend Aristocrats Index, which screens the S&P 1500 Index for companies that have increased dividends in each of the past 25 years. The index then tracks the 50 highest yielders on a yield-weighted basis. Additionally, the maximum weighting for any individual holding is capped at 4 percent.

The index’s methodology results in holdings that are of a much higher quality than traditional high-yield offerings. After all, only rock-solid companies have been able to consistently grow dividends for the past quarter century. The fund’s holdings include companies such as Pitney Bowes (NYSE: PBI), Consolidated Edison (NYSE: ED), Kimberly-Clark Corp (NYSE: KMB) and Clorox (NYSE: CLX).

SPDR S&P Dividend’s expenses are  low at 0.35 percent and the fund yields 3.3 percent.

The yields on both funds are attractive for now. But I expect these yields to drift downward in the coming months. The Fed has given investors clarity on its plans to maintain the current low rate environment. This means that bonds will remain out of favor relative to riskier equities, a situation that will drive down yields.

What’s New

Emerging-market nations are urbanizing at a rapid rate. Meanwhile the population in these regions is growing and discretionary incomes have risen sharply. This confluence of factors has driven a boom in consumer spending. As a result, the emerging-market consumer has become an increasingly attractive investment theme.

Emerging Global Advisors offers direct exposure to this powerful trend with its EGShares Dow Jones Emerging Markets Consumer Titans (NYSE: ECON), EGShares Consumer Goods GEMS (NYSE: GGEM) and EGShares Consumer Services GEMS (NYSE: VGEM).

Last week Emerging Global Advisors added to its lineup of emerging-markets consumer-oriented funds with the launch of EGShares India Consumer (NYSE: INCO), its first country-specific emerging-market consumer fund. The fund holds 30 names from India’s National Stock Exchange and Bombay Stock Exchange. These holdings span a range of consumer-oriented industries, including automobiles, media, hotels and leisure and tobacco. The fund offers exposure to 14 subsectors of India’s consumer discretionary sector.

India has experienced rapid and wide-scale urbanization over the past 20 years, with young and old alike relocating to urban areas. Although average incomes in the nation haven’t caught up with those in China, wages have grown by an average of 6.9 percent over the past five years, providing a significant boost to discretionary incomes.

The fund charges a 0.89 percent annual expense ratio and currently has about $2 million in assets.

Portfolio Roundup

The Global ETF Profits model Portfolio has lagged the broader indexes this week as global central banks have intervened to stabilize markets.  The model Portfolio returned 4 percent over the past week, compared to a 6.5 percent total return for the S&P 500 and a 5.3 percent total return for the MSCI EAFE Index. The Income & Hedges Portfolio has dragged on the model Portfolio’s performance.

• Despite weaker-than-expected gross domestic product growth from Germany, we appear to have bottom-ticked iShares MSCI Germany Index (NYSE: EWG). The ETF has returned  7.7 percent return since we added it to our portfolio last week. Investors appear to be encouraged by the fact that German policymakers have been skeptical about the Eurobond proposal, which would ultimately shift a significant amount of debt onto the nation’s balance sheet.