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The ETF paying the highest dividend is around 4%. However, the growth is low, maybe 70% for past 5 years. On the other hand, some tech ETFs pay only a 2% dividend but they have a 150% growth rate over the past 5 years. What would make people buy a high dividend ETF?

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There are many varieties of ETFs so the dividend and growth performance will vary according to the investment objective.

As an example, consider PGF which is an ETF that contains preferred stocks. If one bought it on 1/27/15 for $18.45 then one would have no capital gain since it closed at $18.45 on 8/30/18. And yet it threw off $3.77 in dividends during this period ($2,044.60) for a yield of 20.46% or 5.32% annualized when dividends were not reinvested.

Why would anyone buy this ETF that provided zero growth during this period? They would do so because they were seeking income rather than growth.

As an aside, these numbers also demonstrate that dividends are not income until share price reduction that occurs on the ex-dividend date recovers by the amount of the dividend(s) [no dividend reinvestment].

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Companies have a lot more control over dividends than they do over their share price. Consequently, dividend forecasts are a lot more reliable than price forecasts.

For those after ‘reliable’ (even if modest) returns, high-dividend ETFs are attractive.

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Diversification and risk. The funds paying 4% dividend are likely invested in solid companies that will hold long-term value. The ones invested in tech stock may have grown 150% over the last 5 years (a really exceptional period where much of the gain was recovery from the crash), but those gains could easily evaporate quite quickly. See e.g. the dot com bubble: https://en.wikipedia.org/wiki/Dot-com_bubble

In addition, for someone investing today, there's the "buy low, sell high" principle. Those stocks have seen large growth in the past: what are the odds that they will continue to do so? Might you not be buying near their peak?

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There is no guarantee that the spectacular growth of technology stocks will continue. It is possible that high dividend utility companies could outperform in the future.

If everyone knew tech stocks would outperform, the price would go up until it was no longer certain that tech stocks were the best deal.

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