3 Best Dividend ETFs | Select wisely and know the pitfalls of investing in Dividend ETFs
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- čas přidán 14. 06. 2024
- The best dividend ETFs are the ones that align the best with your personal dividend investment strategy. In this video I show you the typical pitfalls of investing in Dividend ETFs and how to avoid them. I will then show you 1 dividend ETF which is exemplary of very poor performance, but I will also show you a very popular dividend paying ETF which might not be what it seems.
Finally I will show you the 3 best dividend ETFs that currently exist according to my opinion.
Enjoy this video and don’t forget to like, subscribe and hit the notification bell if you want to see more of these going forward.
Your’s Truly,
European Dividend Growth Investor
Chapters:
00:00 - Intro
00:55 - Dividend Growth Investment Strategy vs Dividend ETFs
02:45 - Typical pitfalls of Dividend ETFs
06:07 - Example Dividend ETF to avoid
07:55 - Example popular dividend paying ETF and know what you own
10:52 - The 3 Best Dividend ETFs right now
References:
All about Dividend ETFs article on my blog: europeandgi.com/dividend-etf/...
Nice presentation, very insightful!
Hey, great advice. Thank you for sharing. I was looking for ETF paying in EUR and was surprised to learn this one was about US stocks. Perhaps a bit more clear at the beginning would have been nice. Cheers
Too bad we can't buy US ETFs directly because of EU regulations.
My bank in Finland has some dividend ETFs listed in XETRA but all are low yield ones that I have found.
If you have a brokerage that allows you to sell put contracts you can sell a put for schd and via that route and eventual assignment get to own 100 shares of schd. I'm from Belgium and use Lynx (interactive brokers). With the options you can get to own VTI, VOO, SPY, SCHD, DGRO, ...
Brilliant. You are a genius
Awesome video!
Thanks buddy!
If I'm interested in buying a dividend ETF but I want the dividends to be reinvested should I buy a distributing etf and reinvest the dividends myself or buy an accumulating etf (the offer is quite limited for accumulating dividend etf's) is it the same from a tax standpoint? thanks!
Where do you buy SCHD? in IBRK and Degiro i can´f find them...
apenas podes comprar estes ETF's através de opções na IBRK (atenção que ao comprar através de opções serão sempre multiplos de 100 unidades)
I would really love a short breakdown of how taxes are witheld for a european when investing in UCITS ETFs based in Ireland. for Dividends and also treasury coupons. I can't find definitive info on this topic, but it is vital for european etf investors
The SPDR EU aristocrats comment was an eye-opener for me. Thanks for that. All suggested etf's are in US market and thus give dividends in $. How about something similar but receiving dividends in €?
So glad to see your fav div etf is SCHD as well
low expense ratio, good capital appreciation potential, good div growth, a portfolio of excellent companies
this ETF just has it all
Definitely! I also hope it will show the same performance going forward. At least the starting yield is pretty nice in the current environment.
@@EuropeanDGI which broker do you use in Europe to buy SCHD please ?
@@marianSEO563 not any its not
Licenses
Can you make a video of dividend etf they we can buy in europe, and not with etoro :D
How to buy SCHD from Europe, in my case Portugal
How about ucits ones I found the fidelity quality us income fusd to be interesting based on the holdings
Hey Tchulo, check my article about dividend UCITS ETFs www.europeandgi.com/dividend-etf/15-dividend-ucits-etf-s-for-european-investors-in-2022/
is it a bad decision to invest in a USD denominated ETF if my broker account is in EUR? I don't want to lose money on spreads. Will this problem be eliminated by picking a good performing ETF instead of an European ETF, like VWCE (which is currently 100% of my portfolio)?
Hey, not necessary, it's just the currency risk. A well diversified ETF as you have now might be all what you need. I wouldn't worry too much about the spreads if you're a buy& hold investor.
I prefer VYM over VIG. Higher yields and lower cost shares which allows me to buy more.
Would very much appreciate a UCITS version of this. None of these are on DeGiro sadly.
Yep, I'll try to do another video this year about UCITS ones 👍
Yeah, I'm also looking for div growth etfs on degiro! A video or podcast about that would be great!
@@CarloGavanelli i have checked a few, maybe 5 or 6. Found them all very disappointing to be fair..
Fedelity quality us income ucits $fusd solid dividend etf
VIG and SCHD are not available to European retail investors, no?
Excellent video. I would only add one thing, is that most of those ETF's pay a dividend without any tax at source, gross=net. While most individual stocks have their dividend taxed at source, for example 15%. It means higher taxes at year end declaration with ETF dividend income.
Thanks for sharing that Leto. Personally my taxes are difficult already and that's why it doesn't add additional complexity haha. It actually allows me to reinvest that money already and enjoy some time of compounding (minimal effect though)
@@EuropeanDGI The principle to make the money work in the meantime is always good!
Indeed, etf's are taxed twice for indivudal
Leto this is something that troubles me. UCITS ETFs supposed to be tax free (I do not see a tax being withheld in my account). If I buy Munich RE, which is German, I pay about 25% tax rate as a foreign investor. If I own this company through an ETF I don't pay any tax??? I am not certain that this is the case. Does the ETFs needs to be domiciled in Germany or this doesn't play a role??
Hi! Do you own any dividend ETF in your portfolio? How could you buy these ETF's in Europe?
I'm really looking for the European version of SCHD but I can't find it. Do you know what it is please?
Hi Benjamin, no, there is none. I have a post with some alternatives, but they don't come close enough: www.europeandgi.com/dividend-etf/15-dividend-ucits-etf-s-for-european-investors-in-2022/
@@EuropeanDGI that's what I thought. Thank you for your reply
@@benjaminh.9139 EU is literally the worst! Just blocking all the american ETF´s like that, bloody North Korea ;(
I can buy some Vanguard ETF´s from Sweden which Vanguard listed in Germany fortunately, but none of the ETF´s mentioned in this video
There's another pitfall and I think an important one: Most dividend ETFs' payout yield is considerably lower than the dividend yield of the stocks they are composed of. This has to do with tax deduction at source and is a serious double taxation issue if you live in a country where the distributions (for distributing ETFs) and/or capital gains (for accumulating ETFs) are taxed. When holding stocks directly, you can reclaim the taxes paid double, but not when holding an ETF. This tax burden that's added only to an ETF drags down the compounding. It's an issue for all stock ETFs but it's particularly serious for dividend ETFs where most of the total return comes from dividends.
Great video! Unfortunately i live in the Netherlands and (as far as I know), I cannot buy the SCHD etf at my broker DeGiro. Do you have any other recommendation?
Greetings
You cant buy american etf in europe !
How do you buy SCHD while living in Europe? I dont want a tracker or an option, I want the stock/etf. Currently Im buying this instead, SPDR S&P U.S. Dividend Aristocrats UCITS ETF, ticker SPYD.
It has outperformed SCHD the last 5 years and has a long history. The expense ratio is a bit higher though, but at least I am able to buy this living in Europe.
At IBKR you could ask them to switch your profile to professional. However, you would lose consumer protection. Hence, I wouldn’t do that.
Like you, we’re stuck to dividend ETFs:
www.europeandgi.com/dividend-etf/15-dividend-ucits-etf-s-for-european-investors-in-2022/
cant have VIG on europe brokers...
I'm investing into growth etf(ivv, itot and vug) then move over to dividened when I have enough accumulated.
Hey Mc Kinght, I assume you're able to do that in a tax-retirement account, right?
@@EuropeanDGI yes I have tax exempt bond as well, it also compliment my Roth.
what is the use to buy dividend etf, we (Belgium) get 30 % taxed....
If that's the case, then probably none. For the rest of the world it might be attractive though ;-)
A channel called "European Investor" and all the ETF's showed are not allowed in Europe..
I have only one question...Where we can buy USA ETFs in Europe? Are they available in Europease brokers? Thnaks for another fantastic movie:)
Some of these are available! As an example, I can see that i can buy SCHD at IBKR and Saxo Bank.
@@EuropeanDGI ok thanks for your answer...another reason to open en account at IBKR:) Currently I try to invest with Degiro (btw Polish family leaving in NL so oposite to you:).
I stand corrected, at IBKR it isn't available for retail investors :-(
@@EuropeanDGI but i think i saw it at etoro…but iis it worth to open account only for one etf??
Hey
European Dividend Growth Investor. Are you from Poland?
Yep, I live in Poland 👍
@@EuropeanDGI So you must have IKE and IKZE accounts. Can you give more UK dividend growth stocks content? This is my strategy based on non tax paying dividends. Just consider this. Thank You.
Very good video. Unfortunately, all three ETFs are not ucits.
Hi Netso, I'm able to buy some of these, either via IBKR, Saxo or DeGiro. You might want to double check it 👍
@@EuropeanDGI At DGIRO and IB I can't buy any of the three
You can ask your broker or bank to be reclassified as a "per se professional client", by default you are "retail". It's supposed to mean less protection for you, less information, but in this case it will allow you to buy those ETF's and in fact many others that are not ucits.
I stand corrected, you can't buy at IBKR as a retail investor. See Leto's reply as well. You might want to give that a try?
Might be interesting to have some examples of UCITS compliance ones as well, cause not many people have access to the professional accounts options
none of those are available on degiro.... nice.
$UWMC , healthy balance sheet, price all time low due fear of inflation, fat dividend.
I wonder why all the three best ETF suggested by you are not “ucits”.. 😤
Because we have stupid EU regulation in place that should protect us but rather pushes us into higher costs and worst performing ETFs 😤
But point taken, one of the upcoming videos will be about UCITS etfs so stay tuned 👍
@@EuropeanDGI what about launching an ETF (ucits) that follow our preferences? 😜
To me it’s unbelievable that not even one of the big providers has such an etf in its portfolio 🤷🏻♂️
P.s. if I’m not wrong there should be one by wisdomtree but it’s an accumulation one
@@EuropeanDGI Yes. I am expecting for this video.
You can not buy SCHD in Europe
If can’t buy these in Europe video was pointless!
All these ETFs cannot be bought for European investors...