Canadian ETF Dividend Portfolio - Risky?

[Ekliptix]

I came across this Canadian fellow who's totally focused on a diversified portfolio of high dividend yield ETFs, most of them Canadian. He claims to get 10%+/yr overall.
He says he's not too interested in the actual share value as he is a long term holder, but more focused on living off the dividends. This is for his non reg investments.

For their RSP, he and his wife have a similar strategy, except they re-invest (DRIP).

When I look at this plan, I like the yield and diversity of funds, but it also seems too good to be true as a long term plan.

Opinions on this strategy, for the long term?

[Buster]

dividends don't matter.

[ExtraSlow]

Subscribed, will comment later.

[suntan]

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dividends don't matter.

If he's living off the money, it matters.

Since dividends have already been taxed, his personal income tax is very very small.

[littledan]

Interested

[ExtraSlow]

"Dogs of the dow" kind of strategies are reasonably well regarded as sound options, and sort of use dividends as a screener for stocks that could provide capital appreciation as well. I hate to think of dividends as a single focus, but I do think they are useful, and I do have dividend ETF's as a major part of my portfolio. That tends to concentrate your investments in Finance, Utility and resource extraction industries, but that's what Canada's economy is based on anyway.

[Buster]

There's nothing wrong with dividends.

But they're irrelevant.

[killramos]

Dividends are great for companies that have mother better to do with the money.

[Disoblige]

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Dividends are great for companies that have mother better to do with the money.

killy says mother a lot. phone doesn't lie. momma's boy!!!

[killramos]

Accurate

[JRSC00LUDE]

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There's nothing wrong with dividends.

But they're irrelevant.

I like having them on my CDN bank stocks, just drip'n away over time.

[Manhattan]

This guy wears a lot of adidas suits while hawking investment advice/courses for a fee on the web...

EDIT: 5 mins into the video and some of the advice is downright bad to dangerous

[JRSC00LUDE]

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This guy wears a lot of adidas suits while hawking investment advice/courses for a fee on the web...

EDIT: 5 mins into the video and some of the advice is downright bad to dangerous

Probably still better than WFG.

[davidI]

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There's nothing wrong with dividends.

But they're irrelevant.

This.

To elaborate for those who don't follow, it's better for a company to re-invest profit rather than distribute dividends provided they have good returns on invested capital (ROIC).

The problem with dividends from the shareholder perspective is that you can't plan your withdrawals or tax strategy. That said, it still makes more sense for some companies to distribute than to do the share buybacks they've been doing at lofty valuations which end up rewarding management (if you as a shareholder wouldn't want to purchase stock at that price, why would you want management to do so?)

[Buster]

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This.

To elaborate for those who don't follow, it's better for a company to re-invest profit rather than distribute dividends provided they have good returns on invested capital (ROIC).

The problem with dividends from the shareholder perspective is that you can't plan your withdrawals or tax strategy. That said, it still makes more sense for some companies to distribute than to do the share buybacks they've been doing at lofty valuations which end up rewarding management (if you as a shareholder wouldn't want to purchase stock at that price, why would you want management to do so?)

I don't have a huge issue with share buybacks, so long as they don't use debt to do it (although plenty of exceptions to this as well.)

[suntan]

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I don't have a huge issue with share buybacks, so long as they don't use debt to do it (although plenty of exceptions to this as well.)

I'm curious, when you're ready to retire, how are you planning to draw cash out?

My company may be sold soon, I get to "retire" at the ripe old age of 47.

[ExtraSlow]

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My company may be sold soon, I get to "retire" at the ripe old age of 47.

This is the dream, get "retired" out of a company, get a payday, and then work less at some passion project until you don't enjoy work anymore.

[Tik-Tok]

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This is the dream, get "retired" out of a company, get a payday, and then work less at some passion project until you don't enjoy work anymore.

Every Canadian Forces member. Work 20-25 years until youre 45, then collect a fat pension while working as a civilian for another 10-15 years.

If you're extra conniving, you can do the exact same job in the forces as a civilian contractor, at double the previous wage.

[suntan]

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This is the dream, get "retired" out of a company, get a payday, and then work less at some passion project until you don't enjoy work anymore.

I'm insane, I'm going to start another company.

But this time, no other equity owners other than my wife, and she gets non voting shares and the shareholders' agreement will have drag-along stipulations.

[ExtraSlow]

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Every Canadian Forces member. Work 20-25 years until youre 45, then collect a fat pension while working as a civilian for another 10-15 years.

If you're extra conniving, you can do the exact same job in the forces as a civilian contractor, at double the previous wage.

I'm the last guy to begrudge armed forces members their compensation.