As a general rule, more stocks or ETFs doesn’t necessarily make a portfolio diversified. With so much of the S&P 500 being top-heavy and overweight in mega-cap tech companies, adding a growth or semiconductor ETF to a core S&P 500 fund doesn’t do much to actually spread out risk or exposure.
The same principle applies to dividend ETFs. You shouldn’t choose only higher yielding funds, nor should you just load up on the latest top performers. You need to understand what the fund’s target market is before matching it up with different strategies to give you a more comprehensive and diversified portfolio.
With so many choices in this space, it’s actually pretty easy to cover all three dividend investing pillars — dividend growth, dividend quality, and high yield — with just a few ETFs. If you’re building out the dividend equity segment of your portfolio, here are three solid dividend…
