Dividend ETFs or Individual Stocks

(Alex Warren) #1

Hi guys,

with the android release very close, I wanted to know how people felt about dividend stocks and ETFs, and if they felt one was better than the other? I think they could be useful for growth? IF anyone has much experience with them or any good reading material on them feel free to share :slight_smile:

Thanks

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#2

It’s not a case of one being better than the other, just that ETFs offer more diversification.

Check here on the importance of diversification:

I hold both and also investment trusts, which again are more diversified than individual stocks.

3 Likes
#3

ETF pay no stamp duty and also offer diversification with a single product. Also the fund will (should) rebalance itself without you having to admin your portfolio%

I like ETF because I can fire and forget.

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#4

Your title says “Individual”, but your question mentions “dividend”. If you’re asking about dividend stocks, you could invest in an ETF that focuses on high-dividend paying companies.

(Alex Warren) #5

Yeah, that is the approach I want to take because I’ll be investing monthly I want to be able to just invest and leave it for a while

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(Alex Warren) #6

Would that pay out more dividend on average than just buying into stocks that pay dividends? I guess it would lower my risk aswell

#7

I think it would pay out the exact same dividend as owning all the constituent stocks individually. You overpay very slightly to cover management fees etc. But you gain by having a “correctly” balanced, well diversified investment that automatically takes care of itself, that may eliminate your non-systematic risk in the sector/region the ETF specialises in.