Start investing in dividend stocks can be done for example with a basket of 15+ different individual dividend stocks to accomplish differentiation and risk reduction. Alternatively, you could start with one or more dividend ETFs and even with little money. The question is what is the best dividend ETF? Here is an update on the year-to-date return.
Five Dividend ETF Analyzed
Earlier this year, we analyzed 10 dividend ETFs and answered the question “What is the best dividend ETF for long-term performance?”, the results can be found on the page Top-5 Best Dividend ETF’s.
The top-5 at the start of 2021 contained the following dividend ETF’s:
|iShares Core Dividend Growth ETF||DGRO|
|WisdomTree U.S. Dividend Growth ETF||DGRW|
|ProShares S&P 500 Dividend Aristocrats ETF||NOBL|
|Vanguard Dividend Appreciation ETF||VIG|
|Vanguard High Dividend Yield ETF||VYM|
As a check-point, here are the total return of the 5 dividend ETFs and the S&P 500. It is good to see that the ETF’s can match or outperform the S&P 500 index. Two dividend ETFs are just below the total return of the index, while the high dividend yield one is showing a stronger performance.
Other Sources of Dividend Investment Ideas
There are several lists to quickly screen for businesses that regularly pay rising dividends.
- The Dividend Aristocrats Index is based on 64 companies part of the S&P 500 and with 25+ years of consecutive dividend increases.
- The Dividend Kings List is even more exclusive than the Dividend Aristocrats. It is comprised of less than 20 businesses with 50+ years of consecutive dividend increases.
- The MoneyInvestExpert Defensive Aristocrats is a performance-based top-10 selection of the Dividend Aristocrats to outperform the market in the long-term.
- Portfolio lists like the Berkshire Hathaway Portfolio or Bill Gates’stock portfolio can be a source.
- For the European focused investors, there is also the list of European Dividend Aristocrats.
- Dividend Champions are not necessarily members of the S&P 500 index, have increased their dividend for 25 or more consecutive years.
- 100+ years of dividend, the list of stocks that pay over 100 years of dividend can be a list of inspiration.
- Blue Chips stocks from the US or the European ones.
Next to selecting the right dividend stocks, important principles for successful long-term investing are Disciple, Diversification, Defensive & indeed Dividend. Read more about this in our free e-book.
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