5D·

Help on choosing ETFs in the portfolio

Hi everyone, I am planning to build a portfolio focused on dividends and wanted to get some advice from those who may already have a few more years in the investment world.

My goal is to create a portfolio that allows me to receive dividends every month and that is composed of ETFs that guarantee both dividend growth and, most importantly, NAV growth, all geared for the long term. In addition, I would still like to devote a good portion of the portfolio to accumulation, so that I can grow something that I can reinvest all on dividends in the future (taking advantage through accumulation of self-investment of dividends).

The portfolio I came up with contains the following ETFs:

Vanguard FTSE All-World Accumulating ($VWCE (-1,26 %)) - 40%
Vanguard FTSE All-World High Dividend Yield ($VHYL (-0,78 %)) - 10%
SPDR S&P Global Dividend Aristocrats ($ZPRG (-0,44 %) ) - 10%
iShares Global Select Dividend 100 ($ISPA (-0,58 %)) - 10%
Fidelity Global Quality Income UCITS ETF ($FGEQ (-1,96 %)) - 10%
VanEck Morningstar Morningstar Developed Markets Dividend Leaders UCITS ETF ($TDIV (-0,55 %)) - 10%
JPMorgan Global Equity Premium Income ($JEGP (+0,09 %)) - 10%

I have chosen exclusively ETFs for my portfolio, all with global exposure, as I would like the portfolio to be managed as passively as possible, i.e., the ETFs themselves take care of reallocating the weight of companies within them.

The ETFs I have identified allow me to receive monthly dividends, however, I had some doubts regarding the choice of some:

Better the $VWCE (-1,26 %) or the $FWRG (-1,51 %)? The latter is newer and has a lower TER, might it be worth choosing it?
I am undecided between the $VHYL (-0,78 %) and the $VWRL (-1,46 %), in that although the former pays twice the dividend as a percentage, it has a much lower NAV growth than the latter. Which one do you recommend between the two?
I am very undecided about whether I really need to add ETFs $ZPRG (-0,44 %) e $ISPA (-0,58 %), as they offer very high dividends, but their growth has been very low. For the $ZPRG (-0,44 %) I could add that 10 percent to the $FGEQ (-1,96 %), as they pay the same months, while as for the$ISPA (-0,58 %), I don't know of any other ETFs that can pay in the same months (January, April, July, October).
Is it actually worthwhile to allocate part of the portfolio to accumulation, or is it better to invest everything in distribution from the beginning? My goal would still be to convert everything to distribution in the distant future.

Beyond these doubts of mine, I am happy to hear other advice about portfolio organization.

Thanks in advance!

7 Comentarios

Golden Boy@randomdude

I find it far too complicated. I would limit myself to 2-3 ETFs in order to adjust price and dividend growth on the one hand and the level of distributions on the other. You also have to rebalance this, but it's easier than with 7 ETFs.
My sample dividend portfolio looks like this in the backtest:
https://getqu.in/OUHJcQ/
Decent growth with stable 3% distributions. If you want more, it will only be at the expense of the total return.

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Antonio@Castell

@randomdude Thanks for the response! I saw the shared portfolio, there is the ETF $GGRP which seems to have good growth compared to $ISPA, only it does not cover all the months of the latter in dividends. If I found an ETF that paid out in the same remaining months, I would focus everything on $FGEQ, $TDIV and the latter

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Antonio@Castell

@randomdude I think I have found an ETF that can guarantee me the continuous flow of monthly dividends. This is the new setup I thought of:
$VWCE - 40%
$FGEQ - 15%
$TDIV - 15%
$HMWO - 15%
$JEGP - 15%

The first one to have an accumulation product that I can use in the future to get cash to use or reinvest, then 3 ETFs with high growth and good dividend yields, and then the JEGP which has high dividends although fairly flat growth. The strengths are precisely those 3 distribution ETFs, which pay dividends quarterly and in different months. What do you think about that? Do you have any advice for me?

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Maximilian@Max095

@randomdude I have a combination of the $FGEQ and $TDIV
Perfect for a dividend growth strategy.

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financial_guru_1801@financial_guru_1801

Hi Antonio, if you don't have any special needs because everything is distribution, it's not tax efficient at all

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Antonio@Castell

@financial_guru_1801 Hi. I know that accumulation is the most fiscally advantageous solution, in fact for this anyway I would like to keep the 40% with single accumulation ETF ($VWCE). However, my goal is to also start a dividend part of the portfolio as of now in order to take advantage of the growth and avoid switching abruptly to distribution in the future. This way I could also establish and study dividend trends over time, which will then be the ultimate solution in the distant future. Do you have any advice on ETFs that I could use? In the comment above I mentioned another possible setup I could adopt, I would appreciate your advice. Thank you!

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Kai P.@DrummerMC

Similar to my strategy, just be aware that dividend focus and nav focus are for the most part mutually exclusive. I would separate a nav-focussed part and a div/dist.-focussed part. Keep the former acc. And only the rest distributing. More tax efficient that way.

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