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The typical dividend yield for a total stock market ETF (such as VTI/SPTM or ITOT) has been about 2% in recent years. Many of my friends who love to give me investment advice told me about ETF's that have a much higher dividend yield that I should invest in instead. (Closer to a 3-4% yield) They promised me that these investments with their huge dividends would give me extra money and I could be rich.
These HIGH DIVIDEND ETF's include: DVY, FDL, HDV, PEY, SDY, SPHD, SCHD, VYM
I just checked how they have done with dividends reinvested for the last 3-5 years. None of them have come even close to the total return of the total stock market funds (VTI, SPTM or ITOT) I gave my friends an earful!
What are your thoughts about investing in these high dividends ETF's vs a total stock market fund, going forward?
If you don't know how to invest, find a good advisor. Do that even if you think you know.
Don't listen to friends or relatives. Realize that the vast majority of them have no training, no skills at analyzing investments and no idea what they are doing.
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Quote:
Originally Posted by jrkliny
If you don't know how to invest, find a good advisor. Do that even if you think you know.
Don't listen to friends or relatives. Realize that the vast majority of them have no training, no skills at analyzing investments and no idea what they are doing.
A very insistent and expert adviser (?) is recommending 40% in his 'special' portfolio of '80+ Dividend / Defensive hand picked stocks'. It is a very reputable and successful firm with long history and much research capability. BUT... history shows (of course) they barely beat the market, and with 0.6-0.8% fees + expensive trades (of course)... I can find my own ETFs, or path to destruction... thank you very much.
Now my friends tell me to pick the top companies in the S&P500 with the highest dividend yield instead of a mutual fund or ETF, that advertises a high yield. I could not find a company with a dividend yield above 3.5% that did better in total return over the last 10 years than a total stock market fund. Can you?
Now my friends tell me to pick the top companies in the S&P500 with the highest dividend yield instead of a mutual fund or ETF, that advertises a high yield. I could not find a company with a dividend yield above 3.5% that did better in total return over the last 10 years than a total stock market fund. Can you?
Again, your friends have no idea...
Don't ask us how to follow advice from your friends and somehow make it work.
Don't even try to ask an advisor.
A good advisor is going to help with an overall investment strategy. A good advisor is not going to help pick individual stocks. They might have some recommendations on individual mutual funds but even that is unlikely. Typically they will recommend choices involving board categories.
The simple answer is the DVY has outperformed the SPY over the last 10 years. This seems like another retarded troll thread.
It makes even more sense to have owned it outside a tax-advantaged fund.
Like anything else, the decision matrix should not be based on only two choices, to go all in or stay out.
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