If my (hypothetical) portfolio consists of ~$5000 CAD, that is spilt 50% SPY (or Canadian equivalent), ~25% assorted sector ETF's and ~25% cash, would it make sense for me to invest between 5-20% in dividend stocks (most likely less than 5 shares per company)? (With the sole intention that said stocks will only serve the purpose of dividends, where any growth or loss in share price is negligible) the cash amount is simply because I only want to invest so much, however the minimum balance for a brokerage account is ~5k
Furthermore, would it make sense to just invest in a dividend or bond ETF (rather than individual equities), and what returns (dividend payments + share price growth) could I expect from one? Also, how are the share prices of such ETF's determined (what makes them go up and down), and how are dividends/bond yields distributed? I've also heard of "high yield" dividend and "high yield" fixed income ETF's, could someone explain those?
To give a little background, I'm a student just about to start university in the fall, and have some extra money that will simply sit in the bank and make 1.25%, so rather than lose to inflation, I'd like to invest in the market. I know many don't recommend to invest in such a scenario, but as I stated, the money will not be put to use for several years, and will be in a conservative portfolio.
With that, since I'm so young, would it make sense for me to put money toward dividend stocks (seeing that they'd be fairly small) and fixed income equities? I obviously have time to overcome short term risk, and have a decent tolerance to risk (sorry r/wsb), so would these safe investments be useful in more risky investments (to offset short term losses)?
Thanks for all replies
Submitted July 07, 2017 at 07:42PM by Santo_R http://ift.tt/2tWa0AT