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Analyzing iShares Core High Dividend ETF For My Dividend Growth Portfolio

Published Wed, 02 Dec 2020 05:25:26 -0500 on Seeking Alpha

Seeking AlphaDividend StrategyAnalyzing iShares Core High Dividend ETF For My Dividend Growth PortfolioDec. 2, 2020 5:25 AM ET|| About: iShares Core High Dividend ETF (HDV), Includes: MPLX, SCHD, T, XOMby: Khen ElazarKhen Elazar Value, Dividend Growth InvestingSummaryAfter looking at SCHD I decided to look at some other dividend ETFs.
Investors often talk about high-yield dividend stock ETFs.
HDV is a well-known ETF investing in high-yield dividend stocks.
In my opinion, focusing on a higher yield is hurting investors along the way.
My current strategy is dividend growth investing. Every month I invest a set amount of money into companies that reliably pay and raise their dividend for a long period of time. The goal of this strategy is to generate a reliable stream of growing income using these assets. Buying stocks on a monthly basis requires analyzing them and see whether they fit my strategy and my portfolio.
In my strategy, I avoid investing in dividend growth ETFs such as the Schwab U.S. Dividend Equity ETF (SCHD). I explained why I do it in a previous article published two weeks ago. In the article I explained the pros and the cons of using the dividend growth strategy using ETFs, and by using the SCHD ETF.
One of the main reasons for concern was the lack of diversification between sectors. This risk can be somewhat mitigated using several ETFs in your dividend growth portfolio. While I believe that it makes more sense to diversify between stocks, this is a plausible solution for some investors who don't have substantial initial funds and look for a cheap way to diversify.
Another ETF that draws the attention of many investors is the iShares Core High Dividend ETF (HDV). Unlike SCHD this ETF focuses on high-yielding dividend stocks, and therefore offers a higher dividend yield when compared to SCHD. This may seem like a shortcut to achieve higher income using less fund, and less time to compound, but as I will present, I believe... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
MPLX LP 28.61   12.4 2.30 2.67 9.28
AT&T 38.38   16.1 2.38 2.04 5.43
EXXON MOBIL 71.98   17.3 4.15 3.48 4.83


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