A long time favorite strategy is based on seeking stocks of companies that have consistently paid and increased dividend payments over time. This is based on the premise that well established companies have a firm foundation in their respective industry and will be consistently sharing profits with its owners. Numerous mutual funds and professionally managed separate accounts use this investment philosophy as a cornerstone in business development.
Now that exchange-traded funds, or ETFs, have arrived, this same basic strategy has been applied to the creation of indexes that are used to guide portfolios that promise to offer the same type of returns as the previously mentioned counterparts have. Three such ETFs are: SPDR S&P Dividend ETF (NYSEMKT: SDY), ALPS Sector Dividend Dogs ETF (NYSEMKT: SDOG) and iShares High Dividend Equity Fund (NYSEMKT: HDV).
Source: Motley Fool
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