US Income Focused ETF Portfolio

By: Pete
Date posted: 12.06.2011 (11:23 am) | Write a Comment  (0 Comments)

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For many investors, the top priority is not capital growth but rather getting a reasonable amount of income with little risk to the capital. How to do? There is probably less need for risky assets such as emerging markets but increased need for diversification. Luckily, ETF’s provide just that. I think that in general an income focused portfolio would include the following asset classes:

Dividend Stocks (generally stable stocks): This could include ETF’s that are focused either on high yield and/or dividend growth and could also include preferred shares.

Corporate Bonds: This could include investment grade bond ETF’s or high yield bond ETF’s

Real-Estate Investments: This would generally done by buying ETF’s that invest in REIT’s.

Government Bonds: Finally, this would include bonds that invest in government bonds, that could be inflation protected or not and have short or long maturities

ETF’s To Include

In order to get those exposures, you could use the following ETF’s:

Dividend Stocks:

  • PFF-iShares S&P US Pref Stock Idx Fnd (ETF)
  • VIG-Vanguard Dividend Appreciation ETF
  • DVY-iShares Dow Jones Select Dividend (ETF)

Corporate Bonds:

  • LQD-iShares IBoxx $ Invest Grade Corp Bd Fd
  • AGG-iShares Lehman Aggregate Bond (ETF)
  • HYG-iShares iBoxx $ High Yid Corp Bond (ETF)

Real-Estate Investments:

  • VNQ-Vanguard REIT ETF

Government Bonds:

  • IEF-iShares Lehman 7-10 Yr Treas. Bond (ETF)

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