Dividend Stocks and Dividend ETFs

Searching for yield but don't know where to turn? The blogosphere has plenty of recommendations. One of the prominent recommendations has been dividend stocks. There are a number of excellent sites that analyze and recommend dividend stocks - in other words, bloggers who do a lot of the work for the do-it-yourself investor. Some that I read on a regular basis include:

• Dividend Growth Investor
• theDividendpig
• The Dividend Guy
• The Passive Income Earner       

 The newbie investor does have to understand, however, that dividend stock investing isn't just a matter of picking the highest dividend stocks. A real key is sustainability. The long-term record of dividend payments and whether they have been increased on a regular basis is important. Whether companies will maintain and possibly increase dividends in the future depends on their financial health and prospects.


For those interested in going the exchange traded fund (ETF) route, an excellent article "Avoiding the Dividend ETF Trap" by Michael Rawson CFA, discusses how to pick ETFs that concentrate on dividend stocks. His article provides a useful table for comparison purposes that presents performance and states the approach used by ETFs in their dividend stock selection process.


I highly recommend the Rawson article to those seeking dividend ETFs. Another useful resource is the "Seeking Alpha" income investing page.