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Looking for diversified ETFs that focus on solid, reliable dividend yield
My father is looking for an ETF that is diversified (or at least, not a narrow-focused sector fund) which invests the way he does. That is, focuses on a reliable dividend yield, and keeps expenses low. Please suggest some, and I will pass them on to him. Thx!
When you say "reliable dividend yield" do you mean the yield defined as the amount of the cash dividend divided by the share price should be relatively constant (ie so that cash distributions are a fixed, let's say, 3% of share price so that if the dollar value of the shares fluctuates unpredictably then the dollar amount of the dividend also fluctuates unpredictably in order to reliably maintain that fixed percentage)?
Or do you mean "reliable dividend yield" as in the cash dividend "yielded" by the shares is a relatively constant dollar amount as opposed to the principal which fluctuates with the share price?
Vanguard has some really low expense dividend ETFs and almost all of Wisdomtree's entire lineup are dividend focused ETFs, but you should think carefully as to what it is you're really looking for because there's almost as many ways to focus on dividends as there are stars in the sky.
I should elaborate. My father is 87 years old. While I know that sounds old, he's really in pretty good physical shape, and expects to be around for a few more years. He wants an investment that does not vary much in price, and gives a good solid dividend yield that also does not vary much. In other words, no "dividend surprises". He owns a lot of stocks, and tries to avoid the ones that announce dividend reductions (and subsequently get hammered on their share price as soon as trading opens up the next day). He'd prefer 90% of the management effort be put into a steady price and reliable dividend, and only 10% be put into capital appreciation. "Equity income", with emphasis on the "income".
Comments
Or do you mean "reliable dividend yield" as in the cash dividend "yielded" by the shares is a relatively constant dollar amount as opposed to the principal which fluctuates with the share price?
Vanguard has some really low expense dividend ETFs and almost all of Wisdomtree's entire lineup are dividend focused ETFs, but you should think carefully as to what it is you're really looking for because there's almost as many ways to focus on dividends as there are stars in the sky.
Regards,
Ted
http://news.investors.com/print/investing-the-income-investor/100412-628170-preferred-stocks-offer-conservative-choice.aspx