hey YouTube I'm Jimmy in this video I'm gonna walk through creating a high
dividend ETF portfolio this video builds on our last video where we looked at
building a long-term dividend ETF portfolio the primary difference is that
in this video we're going to have higher dividends now just like the other two
ETF portfolios that we created our goal in building this dividend ETF portfolio
is to focus on ETFs that have high quality companies lots of
diversification and obviously a very good yield so in our last video we
focused on portfolio stability we target a reasonable yield we had about a three
and a half percent dividend yield but in this video we're going after six percent
so we're gonna get a bit more aggressive about it sure we're gonna have to pay a
higher fee for many of the ETFs since they're going to be specialized ETFs but
allowing for more fees gives us more options when it comes to the ETF space
and just like our last video we're going to turn this portfolio into a satellite
portfolio and basically what that is is you have a core set of holdings and then
you have individual holdings that in theory complement a particular objective
of the portfolio so maybe you want to add more diversification or you want to
add exposure to a particular sector or more growth or more value or more
dividends or whatever it might be that will depend on what individual what each
of us individually want to do with our portfolio okay let's get started
so we're going to call this portfolio our monthly high dividend yield ETF
portfolio it's going to contain five ETFs all that pay monthly dividends once
again our goal is to create our core set of holdings and then we'll talk about
customizable satellite positions so our first core high dividend ETF is the
Invesco S&P 500 high dividend low volatility ETF ticker symbol SPHD. SPHD
has a fee of 30 basis points they have about 50 Holdings and they have a
dividend yield of about 4% and just so we're all on the same page for each of
these ETFs to calculate the dividend what I did is I took the last 12 months
of dividends paid and used those added those up and divided by the current
price and that gives us a dividend yield okay
easy enough so SPHD goes after the less volatile large and mid-cap names picked from
the S&P 500's seventy five highest dividend yielding stocks so the whole
ETF ends up looking a lot like the market dose they have they have
companies like HCP AT&T Verizon Procter and Gamble
companies like that but what I like about this ETF is that they have a lot
of traditionally defensive industries like utilities and basic materials and
the less of the more volatile industries like consumer cyclical and technology so
I like this as our first holding and it will act as sort of a core holding on
some of our more volatile holdings going forward and just like we did in the
other videos we're gonna save the weightings until the end of the video
okay so for our next holding we have the high-yield etf ticker symbol HYLD. HYLD
is the only bond etf in our portfolio they have a fee of 118 basis points and
they have over 100 different holdings their fee is a bit high but it makes a
lot of sense because this is an actively managed ETF and that requires portfolio
managers that can do credit and valuation analysis on the corporate bond
holdings they have a dividend yield of almost 8% and generally they invest in
non investment grade bonds those companies tend to be smaller which
therefore gives us more high yield opportunities but a bit more risk
so HYLD gives us our bond exposure okay so our next holding is the global X
super dividend u.s. ETF ticker symbol DIV DIV has a fee of about 45 basis
points they hold about 47 different companies and they have a dividend yield
about six and a half percent and just like our first ETF well this ETF looks
at low volatility names a bit smaller than the first one but they get a bit
more yield they are also well spread out they're mostly in utilities and
financials they have consumer staples they have some energy some communication
services some real estate some health care so they are a well spread out ETF but
they tend to focus on slightly smaller companies so I think it's a nice
complement to our first two ETFs so for our next holding we have the
wisdom tree us mid-cap dividend ETF tickers simple DON DON has a fee of 38
basis points they have bought 400 holdings and slightly more than 2%
dividend yield more than half their holdings are in consumer discretionary
real estate and industrials they own companies like L Brands Kohl's
tapestry Macy's targa resources and because these company this ETF focuses
on consumer discretionary companies well I think that this ETF offers some growth
opportunities that the other etf's don't have so I believe that this is a
good complement to our portfolio because this gives us a bit of growth
opportunities in addition to a 2% dividend yield okay now on to our last
core holding for that holding we're looking at the Invesco KBW high dividend
yield financial etf ticker symbol KBWD now they have a crazy high fee of about
240 basis points and what they do is they're a specialty ETF they hold about
40 companies but about 95% of them are in the financial sector they have the
highest yield in our portfolio at north of 8% but the majority of their
companies are small to mid cap companies and they're in the financial sector and
I think that complements our portfolio well plus it drives a ton of monthly
dividends now I hate the fee but I love the yield okay so now here's how I would
weigh each of these portfolios for our core portfolio and then we'll look at
some satellite positions so how are we gonna weigh our portfolio so I would
make SPHD the largest holding at about 30 percent of the portfolio because I
lose that they offer the most stable monthly dividends it's their low
volatility companies they give us a dividend yield about four percent but I
think that the reliability of those companies is a good stabilizer to make
that the largest position for us for HYLD and DIV I would do 25% for each position
they offer awesome dividend yields near 7% and they help with overall dividends
then for DON and KBWD well they act as solid diversifies and I'll make them
ten percent for each position one focus is on
financials and the other gives us some mid cap growth opportunities okay so now
we have our core holdings what satellite positions should we add to our portfolio
we can pick individual companies just like we did in our investment portfolio
for beginners video you can see it like in the description below again you can see
our Dow 30 list - if you're looking for good companies that could be good ones
to add you can see that list I've also talked about companies like Apple AT&T
Disney those types of companies could be good diversifiers if you believe that
there's an opportunity maybe there is a value opportunity in one of those or we could
stick with more ETF holdings for our satellite positions if you prefer
getting stable dividends from large cap companies NOBL could be nice so that
add some stability to the portfolio we also talked about AMLP which is a great
ETF for high dividends and exposure to the energy markets another interesting
position to consider would be van eck's vector mortgage ETF they invest in
mortgages and invest goes KBW premium yield equity REIT EFT they invest in
actual real estate properties and they both have dividend yields of around 7%
and they're great diversifiers to this type of core portfolio so how do you
like our core portfolio do you like the main holdings would you
swap anything out for anything else what about the satellite positions would you
go with individual companies or would you go with other ETFs to complement it
let me know what ETFs you would add or what individual companies you think
complement this portfolio well let me know what you think in the comments
below and if you haven't done so already hit the subscribe button thank you for
sticking with me all the way to the end of the video and I'll see you in the
next video thanks