Do you agree with my list of the top 10 dividend ETFs? Let me know what you think! Thank you so much for supporting my work! If you think anyone else would benefit from this video, please share it with them. Patreon supporters, here's the Top 100 stock list: www.patreon.com/posts/build-your-own-114704572?Link&
@@NathanWinklepleckCFA Could you elaborate a bit more on that, please? I don't entirely understand a) why it buys them when yields are higher and b) how that pushes the overall dividend of the fund higher, i.e. why it pushes the dividend growth rate so much.
@@thenerdnetwork I just don't get the worship of SCHD..........You all are really fine with a 3% return..............yet every guru and professor always says to look at total return
@@missouri6014 If every guru and professor says to "look at total return", and you understand that... why are you saying "You all are really fine with a 3% return"? SCHD's total return isn't 3%, 3.62% is their dividend. But SCHD's CAGR is 12.97% over the past 5 years. Compared to the S&P 500's CAGR of 14.87% over the same time period. Now lets break down WHY there is worship of SCHD. Its return is decent, many people are dividend investors, and a HUGE reason is that people want to generate an INCOME stream, like... people retiring? VOO's dividend is 1.23%. So SCHD's dividend provides nearly 3x more passive income for people that want it, and there is less risk involved in SCHD compared to a straight growth fund, but also SCHD's NAV can increase as well... obviously.
Excellent my friend ! I was actually a little surprised to see SCHD come out on top …but I’m sure glad it’s my dividend growth backstop ! I’ll have to take a look at patron
Great video Nathan good to see some less talk about ETFs mixed in with the usual suspects! I love that you include the performance of the index in order to go back further in history. Very insightful as always.
23:42 Nathan, thank you very much for this excellent video! For FNDX, I am unclear as to how does the fundamental weight increase when the price of a stock falls. If the price of a stock falls from $100 to $50, how does that change any of the 3 weights? I didn't understand that part. Sales * (Equity / Assets) stay the same if the share price drops, as do the retained CF and the dividends. I went to the RAFI website to read about their methodology but didn't understand their document.
That would increase the weights, since the index would be buying more--fundamental value would stay the same (or go up) while price falls = higher weight. Or if price goes up, but fundamentals go up less, then the stock would be sold. It is very confusing...
Great analysis! DGRW and CGDV are the two ETFs I’m currently holding for my dividend growth allocation. Very good total return relative to SPY with less volatility and less draw down. Higher overall risk adjusted return. IMO, screening for quality and growth factors has to be a priority above yield and dividend growth history. My overall goal with my portfolio is to best or closely trail the market each year with lower volatility and less draw down. A portfolio with those stats will be strong during both accumulation and draw down.
@@NathanWinklepleckCFA yeah FNDX was a new one for me. Ran a quick portfolio visualizer 10Y back test. Both DGRW and FNDX have about the same starting yield, but DGRW has done better in about every meaningful way. Total return 13.32% vs. 11.82%, lower standard deviation, max draw down -19.29% vs. -26.05% and Sortino ratio 1.34 vs. 1.05. DGRW is also slightly ahead of the market over that time period as well. CGDV is a newer fund. Only about 2 years old. The fund manager, Capital Group, comes from the American Funds family of fund managers that have been outperforming the market for a long time. The performance since inception has been exceptional. Better metrics across the board with much higher total return than the market. However, CGDV only has 55 holdings and is actively managed, so much higher probability to either outperform or underperform due to concentration and active selection. There are a few YT videos reviewing the fund if you want to check them out. They tilt toward quality and momentum factors for selection. It's also a great sector-wise compliment to DGRW to reduce overall portfolio concentration in the tech sector (while still retaining a relatively high tech allocation overall).
Oh, Capital Group... Most overrated fund family ever! LOL I work in the financial services space, so I view them quite negatively! I don't know that I have a real reason to, but I mostly just hate all their salespeople pushing their funds so hard. They shouldn't need pushed that hard if they are that great!
@@NathanWinklepleckCFA well that is an assessment I’ll definitely take to heart! 😂And yes I agree completely about the pushy mutual fund sales, high fees and overrated reputation. Maybe they had a come to Jesus moment because they did a 180 with this ETF. Low fees for an actively managed fund at 33 basis points and an easy access ETF wrapper. It’s grown respectable AUM in the short time it’s been around, so fairly popular. It’s a smaller allocation for me, but a fund I like so far.
Depends on what you’re looking for in an ETF. Do you want more diversification/similar performance to S&P 500? Then FNDX is a great pick. Looking more for downside protection? NOBL. Income and solid performance? SCHD. IF you think growth is going to continue outperforming, then DGRW is a good pick, also.
@@NathanWinklepleckCFA have you check some of the covered call etfs from hamilton some etfs have 11% to 12% yield and are invested in pretty solid sectors like us tech and canadian banks.
Great Dividend ETF UA-cam video ....I just signed up for your Patreon and was hoping to see how you built the 100 coffee can dividend portfolio . Is that anywhere on there? Thanks
I like VIG for its larger number of holdings and slightly lower volatility. I can view SCHD as complimentary since the holdings overlap with VIG is relatively small. Why not own some of both?
Neat video. Just an aside. Not all ETFs track an index (no shortage of Ark and the like out there) but most have a Benchmark index to beat (some benchmarks are made up in-house like AIRR uses). Additionally for index tracking ETFs they dont always keep the same index. SOXX for example no longer tracks the PHLX SOX semiconductor index and changed in 2021 to track the NYSE semiconductor index. Vanguard over the years has also changed some ETF to track CRSP index vs MSCI, and vice versa. Just adding this to show it can be a pain to find out if and when the Benchmark index it tracks changed over the years.
Nathan, I am wondering what are the factors that cause the differences between Index performance and ETF performance. In an ideal world, aren't they supposed to be similar? I just can not wrap my head around on this gap. Thanks.
It could have poor tracking for a number of reasons, but the foremost would likely be transaction costs and fees. If a fund has 50% turnover, it’s going to lose 0.5% per year to transaction costs. Add on top of that a higher fee of 0.5% and it could easily underperform by 1%.
How do you feel about Covered call ETFs? I don't have the experience to sell SCHD myself. But I hope the ETF management does. I just really want to know more about these things before investing, only if someone can put me through.
Not a fan. Essentially you’re selling upside for income. Nothing extra about it. The actual use case is for protecting against sideways markets and earning a volatility premium
DGRW/IHDG mixed with Avantis small cap value funds(AVUV/AVDV/AVEE). Get a mix of dividend growth and growth style of midcap+ and then small cap value to cover the value style and small caps. Might be overcomplicated but I like having everything and covering all bases. Most should stick with VT or VTI/VXUS to not overcomplicate things. Dividend growth and value/factors for those that want to go deeper and get nerdy with it
SCHD is great, but it’s vanilla. I was paid $4 a share on Friday for $MSTY at $27.7 a share, and $IWMY pays $.34 a share, 1% in cash back dividends every week.
I get everything you said however when you put somethinglike SCHD in any fund comparison analyzer that you want up against spy or any of the others the total return is not as good so why would anybody do this if their horizon is 10 or 20 years? Can anyone explain this to me because I just don’t get it?
Because last decade has been all about a few concentrated stocks; the next decade is unlikely to repeat that, so as those big firms mature, ie slow down, their future returns will also, especially with valuations so high. Historically, more value-oriented stocks like SCHD et al, have outperformed growth. Last 10-20 years have been an anomaly compared with 100+ years. Past performance not indicative of future returns.
Two 5 star rated (by Morningstar) ETFs that have gained ~ 14% annually for the last ten years, according to Yahoo Finance, are PPA and KBWP. Now they are sector concentrated, and don't offer a comparable dividend compared to the ETF's mentioned in the video, but they are worthy of mention and maybe further analysis ...
Thank you Nathan for an excellant analytic video. I would love to see your expert analysis and thoughts on Piotroski score method. Consider it as a humble request from your UA-cam Fan. 😉
It’s all relative to time and momentum. I jumped into TQQQ awhile back and am up 87%. Is it the best…no…was it the best for that time with the current momentum…absolutely
SCHD is always number 1. It's the pairing it a few other dividend ETFs that gets tricky. Surprised DIVB didn't make the list. Also, Capital Group has a couple of ETFs worth looking at.
This is just what I was looking for. Thanks for the course. It really helped boost my self confidence. Might do the next one. ☺ Thanks for all your hard work 👍👍👍
![Lp. Сердце Вселенной #60 РОЖДЕНИЕ ЛОЛОЛОШКИ [Финал] • Майнкрафт](http://i.ytimg.com/vi/YoR0pAV9FVQ/mqdefault.jpg)
Do you agree with my list of the top 10 dividend ETFs? Let me know what you think! Thank you so much for supporting my work! If you think anyone else would benefit from this video, please share it with them. Patreon supporters, here's the Top 100 stock list: www.patreon.com/posts/build-your-own-114704572?Link&
VTI all the way.
This is the best fundamental analysis of dividend etfs on youtube.
Wow, thank you Tyler!
@@NathanWinklepleckCFA 😂👏
What I love most about SCHD is the massive dividend growth rate of around 10-14% year over year (at least in recent years).
Yeah, it buys when yields are higher, so naturally pushes that dividend up over time, even if underlying stocks aren’t growing dividends as fast.
@@NathanWinklepleckCFA Could you elaborate a bit more on that, please? I don't entirely understand a) why it buys them when yields are higher and b) how that pushes the overall dividend of the fund higher, i.e. why it pushes the dividend growth rate so much.
I’ve been sharing this video a lot. The historical performance of the indexes going back as far as you do is hard to find.
Thank you SCHDSTAN!!!
Always look forward to your thoughtful videos. Wish I got them more frequently.
Wish I could make them more frequently!! 😜
Awesome video Nathan! I had a feeling SCHD would be #1 lol. Well done 🫡 Really enjoyed watching 👍
Glad you enjoyed!! Appreciate it John
SCHD dividend seems only 1.7%, it basically look like a growth ETF?
@@W.H-p6i its dividend is 3.62%
@@thenerdnetwork I just don't get the worship of SCHD..........You all are really fine with a 3% return..............yet every guru and professor always says to look at total return
@@missouri6014 If every guru and professor says to "look at total return", and you understand that... why are you saying "You all are really fine with a 3% return"? SCHD's total return isn't 3%, 3.62% is their dividend. But SCHD's CAGR is 12.97% over the past 5 years. Compared to the S&P 500's CAGR of 14.87% over the same time period.
Now lets break down WHY there is worship of SCHD. Its return is decent, many people are dividend investors, and a HUGE reason is that people want to generate an INCOME stream, like... people retiring? VOO's dividend is 1.23%. So SCHD's dividend provides nearly 3x more passive income for people that want it, and there is less risk involved in SCHD compared to a straight growth fund, but also SCHD's NAV can increase as well... obviously.
Excellent my friend ! I was actually a little surprised to see SCHD come out on top …but I’m sure glad it’s my dividend growth backstop ! I’ll have to take a look at patron
Thanks Kimm!!! Good to “hear” from you
Great video Nathan good to see some less talk about ETFs mixed in with the usual suspects! I love that you include the performance of the index in order to go back further in history. Very insightful as always.
Glad you liked it!
Thank you Nathan! As always, your analysis is well thought out and thorough.
Thank you! And thank YOU for your support as a member!!!
23:42 Nathan, thank you very much for this excellent video! For FNDX, I am unclear as to how does the fundamental weight increase when the price of a stock falls. If the price of a stock falls from $100 to $50, how does that change any of the 3 weights? I didn't understand that part. Sales * (Equity / Assets) stay the same if the share price drops, as do the retained CF and the dividends. I went to the RAFI website to read about their methodology but didn't understand their document.
That would increase the weights, since the index would be buying more--fundamental value would stay the same (or go up) while price falls = higher weight. Or if price goes up, but fundamentals go up less, then the stock would be sold. It is very confusing...
Thanks for the extra info on FNDX and NOBL.
Sure thing!
Damn, FDVV didn’t make the list. Any opinion on this fund?
It wasn't in top 10 AUM, so I didn't include it. Sorry! No opinion here.
Great analysis! DGRW and CGDV are the two ETFs I’m currently holding for my dividend growth allocation. Very good total return relative to SPY with less volatility and less draw down. Higher overall risk adjusted return.
IMO, screening for quality and growth factors has to be a priority above yield and dividend growth history. My overall goal with my portfolio is to best or closely trail the market each year with lower volatility and less draw down. A portfolio with those stats will be strong during both accumulation and draw down.
DGRW is an excellent pick! FDNX was surprisingly good, as well. Haven’t heard of CGDV. What’s that one about?
@@NathanWinklepleckCFA yeah FNDX was a new one for me. Ran a quick portfolio visualizer 10Y back test. Both DGRW and FNDX have about the same starting yield, but DGRW has done better in about every meaningful way. Total return 13.32% vs. 11.82%, lower standard deviation, max draw down -19.29% vs. -26.05% and Sortino ratio 1.34 vs. 1.05. DGRW is also slightly ahead of the market over that time period as well.
CGDV is a newer fund. Only about 2 years old. The fund manager, Capital Group, comes from the American Funds family of fund managers that have been outperforming the market for a long time. The performance since inception has been exceptional. Better metrics across the board with much higher total return than the market. However, CGDV only has 55 holdings and is actively managed, so much higher probability to either outperform or underperform due to concentration and active selection. There are a few YT videos reviewing the fund if you want to check them out. They tilt toward quality and momentum factors for selection. It's also a great sector-wise compliment to DGRW to reduce overall portfolio concentration in the tech sector (while still retaining a relatively high tech allocation overall).
Oh, Capital Group... Most overrated fund family ever! LOL I work in the financial services space, so I view them quite negatively! I don't know that I have a real reason to, but I mostly just hate all their salespeople pushing their funds so hard. They shouldn't need pushed that hard if they are that great!
@@NathanWinklepleckCFA well that is an assessment I’ll definitely take to heart! 😂And yes I agree completely about the pushy mutual fund sales, high fees and overrated reputation.
Maybe they had a come to Jesus moment because they did a 180 with this ETF. Low fees for an actively managed fund at 33 basis points and an easy access ETF wrapper. It’s grown respectable AUM in the short time it’s been around, so fairly popular. It’s a smaller allocation for me, but a fund I like so far.
would be nice seeing a video on leveraged etfs like tqqq
Sure thing! I actually made one many years ago :) I’ll see if I can dig up
Does the team that managed the fund changed during the period you are analysing?
Not that I'm aware of.
Many think these div etfs are a hedge against market crashes. I backtested myself and noticed they drop almost as much as s&p.
Hi . What is your opinion on QDPL?
None, sorry!
Interesting as always!
Can you do a video on SPDG? It is interesting methodology, but because it is quite small and new, no one talks about it
Great suggestion! I’ll take a look
Nice video. Would you be able to do the same analysis for income ETFs?
Please do this for quality etfs like QUAL and JQUA!
Will add it to my list!
This is type of video dividend investors need. Not hype, just facts!
I was excited to DGRW and SCHD were ranked in the top five.
Thank you, Michael!
Very informative and helpful video as always, thank you! How do you say covered call ETFs which are popular these days.
Not a fan... not really dividends, just selling upside. Also comes with it's own risks.
Thank you!
Does the downside in 2007 to 2009 include the dividend or just the price ? Where can we get the historical data? Thank you for your sharing!
Total return :)
Great analysis! I own some SCHD. Is SDY the same or similar to SPYD?
Not sure if it’s similar or not, I have looked into SPYD but can’t remember exactly
So should we go 3 ways on the top 3 etf listed here or go all in on SCHD?
Depends on what you’re looking for in an ETF. Do you want more diversification/similar performance to S&P 500? Then FNDX is a great pick. Looking more for downside protection? NOBL. Income and solid performance? SCHD. IF you think growth is going to continue outperforming, then DGRW is a good pick, also.
Thank you! Have you ever talked about VYMI for diversification?
Nope, but will add to my list!
SCHG?
Love that ETF, but it’s not a dividend ETF
@@NathanWinklepleckCFA have you check some of the covered call etfs from hamilton some etfs have 11% to 12% yield and are invested in pretty solid sectors like us tech and canadian banks.
video cuts are a bit choppy btw
Sorry about that!
Used a new software and won’t be using it again…
@@NathanWinklepleckCFA all good video was still enjoyable!
FDVV is an excellent ETF
Thanks for sharing!
Vig is my favorite
Still?
Great Dividend ETF UA-cam video ....I just signed up for your Patreon and was hoping to see how you built the 100 coffee can dividend portfolio . Is that anywhere on there? Thanks
No, but I can post it somewhere! I built it a few weeks ago now.
I like VIG for its larger number of holdings and slightly lower volatility. I can view SCHD as complimentary since the holdings overlap with VIG is relatively small. Why not own some of both?
Neat video. Just an aside. Not all ETFs track an index (no shortage of Ark and the like out there) but most have a Benchmark index to beat (some benchmarks are made up in-house like AIRR uses).
Additionally for index tracking ETFs they dont always keep the same index. SOXX for example no longer tracks the PHLX SOX semiconductor index and changed in 2021 to track the NYSE semiconductor index. Vanguard over the years has also changed some ETF to track CRSP index vs MSCI, and vice versa. Just adding this to show it can be a pain to find out if and when the Benchmark index it tracks changed over the years.
Yes, like VIG did! :/ Good point on ARK
@@NathanWinklepleckCFA yep!
So SCHD beat the S&P by 711%?
I still love my DIVO. DGRW second.
Thanks for sharing. I’ve not looked into DIVO.
@@NathanWinklepleckCFA It a monthly. It is more designed for DRIP.
Still a great analyse!!! Thanks Nathan
Thanks! 🙏
Nathan, I am wondering what are the factors that cause the differences between Index performance and ETF performance. In an ideal world, aren't they supposed to be similar? I just can not wrap my head around on this gap. Thanks.
Yes, it's both fees, tracking error, and then trading costs like bid/ask spread that aren't accounted for in index performance.
10. DVY
9. SDY
8. RDVY
7. VYM
6. VIG
4. DGRW, DGRO
3. NOBL
2. FNDX
1. SCHD
yes
Very informative. Thank you
Glad it was helpful!
Why/how would a fund greatly out or underperform the index it is based off of?
It could have poor tracking for a number of reasons, but the foremost would likely be transaction costs and fees. If a fund has 50% turnover, it’s going to lose 0.5% per year to transaction costs. Add on top of that a higher fee of 0.5% and it could easily underperform by 1%.
@@NathanWinklepleckCFA Just surprised by SCHDs poor tracking. Still, it is my largest holding outside of the sp500 index
How do you feel about Covered call ETFs? I don't have the experience to sell SCHD myself. But I hope the ETF management does. I just really want to know more about these things before investing, only if someone can put me through.
Not a fan. Essentially you’re selling upside for income. Nothing extra about it. The actual use case is for protecting against sideways markets and earning a volatility premium
DGRW/IHDG mixed with Avantis small cap value funds(AVUV/AVDV/AVEE). Get a mix of dividend growth and growth style of midcap+ and then small cap value to cover the value style and small caps. Might be overcomplicated but I like having everything and covering all bases. Most should stick with VT or VTI/VXUS to not overcomplicate things. Dividend growth and value/factors for those that want to go deeper and get nerdy with it
Thanks, Kyle!!! Glad to see you again, my friend. Always good advice.
@@NathanWinklepleckCFA hope you are well bud. Traveling next year or 2. Will have to figure something out for sure. You got my info 👍
Starkes Video, danke😅😊
Thanks!
Thanks for the video. I came to hear from you about HDV. Not this time 😢
Next time!
downside of creating your own “index fund” would be capital gains no?
Not if you never sell 😜
@@NathanWinklepleckCFA yes that’s how i prefer to invest as well 😂
aistockadvisor AI fixes this. end ETF by Nathan Winklepleck
There we go!!
SCHD is great, but it’s vanilla. I was paid $4 a share on Friday for $MSTY at $27.7 a share, and $IWMY pays $.34 a share, 1% in cash back dividends every week.
Be careful...
Any good reasons why SCHD has done so poorly the last 12 months (compared to the S&P500)?
That’s a great question; I’d guess mostly because of low technology exposure.
Thoughts on COWZ & FDVV?
Haven’t studied those! What are the methodologies?
@@NathanWinklepleckCFA COWZ(0.49 ER) & FLOW{0.25 ER} = Free cash flow midcap value ETF. FDVV= large cap value etf with high Tech exposure(25%).
I get everything you said however when you put somethinglike SCHD in any fund comparison analyzer that you want up against spy or any of the others the total return is not as good so why would anybody do this if their horizon is 10 or 20 years?
Can anyone explain this to me because I just don’t get it?
Because last decade has been all about a few concentrated stocks; the next decade is unlikely to repeat that, so as those big firms mature, ie slow down, their future returns will also, especially with valuations so high. Historically, more value-oriented stocks like SCHD et al, have outperformed growth. Last 10-20 years have been an anomaly compared with 100+ years. Past performance not indicative of future returns.
@@NathanWinklepleckCFA thank you
Schd no go in eu :s
Bummer! What options do you have?
FUSD is the same
@@karsinds no its not. Different top 10 stocks. Different sector weights. Different starting yield. Different dividend growth. Different expense ratio
Two 5 star rated (by Morningstar) ETFs that have gained ~ 14% annually for the last ten years, according to Yahoo Finance, are PPA and KBWP. Now they are sector concentrated, and don't offer a comparable dividend compared to the ETF's mentioned in the video, but they are worthy of mention and maybe further analysis ...
Excellent; thanks for sharing!!
Thank you Nathan for an excellant analytic video. I would love to see your expert analysis and thoughts on Piotroski score method. Consider it as a humble request from your UA-cam Fan. 😉
I'm making a video for you! ;) Will be posted in about 2 hours.
@@NathanWinklepleckCFA Thanks you Sir. Appreciated. 🙏
SCHD, DGRO and SCHG that’s all you need for a happy retirement 😂
Nice portfolio :(
Edit: :)
FDVV
Thanks for your input!
SCHD is number 1
For some people… 😜 others would be 2 or 3
@@morrisgarage8887 thanks! I found this video informative though painfully long.
LOL I tried to make it as a short as possible! :(
@@morrisgarage8887 🐑🐑🐑🐑🐑🐑🐑🐑🐑🐑
@@NathanWinklepleckCFAor 56 or 57
Whats with the title? (Beat S&P 500 by 711%)???
Would still be interested to know which dividend index outperformed the SP500 by 711% you mention at 1:22
No JEPI/JEPQ? I have really been liking those in my portfolio
Those aren’t considered dividend ETFs imo and per most ETF sites. Covered calls are options based and essentially sell upside for income.
Buy MSTY
It’s all relative to time and momentum. I jumped into TQQQ awhile back and am up 87%. Is it the best…no…was it the best for that time with the current momentum…absolutely
Risky but can pay off in a consistent uptrend
Appreciate the info!
You bet!
SCHD is always number 1. It's the pairing it a few other dividend ETFs that gets tricky. Surprised DIVB didn't make the list. Also, Capital Group has a couple of ETFs worth looking at.
The list was only based on top 10 largest by AUM
This is just what I was looking for. Thanks for the course. It really helped boost my self confidence. Might do the next one. ☺ Thanks for all your hard work 👍👍👍
Glad it helped!!!
share some inside knowledge from ur job, give me a x2 so that i can retire bro
If I only knew lol
Pfizer is my favorite dividend stock.
You need to look harder
Congrats again. I wonder when do you find time to coduct all this research among your full time job and full time parenting!!!
😝 sleep is optional!!!
All hail the king of ETFs !!! Won't spoil here with the name. People should watch the video for it.
😝
First
Welcome, wasbii!!! Good to see you, my friend.
no u
? what classic?