World Stock Watch

Unlocking the Power of Dividend Investing

As the global economy prepares for a potential slowdown in 2025, investors are seeking stability and consistent income. One savvy investor’s remarkable journey serves as a shining example of the benefits of dividend investing.

A Young Investor’s Success Story

At just 25 years old, this investor has achieved an impressive annual dividend income of $10,467, or approximately $872 per month, with a total portfolio value of $291,000. His portfolio yield stands at around 3.6%. This remarkable feat is the result of patience, wise investment choices, and a bit of luck.

Diversification is Key

The investor’s portfolio is diversified across various asset classes, including ETFs, mutual funds, and individual stocks. Let’s take a closer look at some of his top holdings:

• Vanguard S&P 500 ETF (VOO): A broad exposure to the US market, earning $10,467 in dividends annually.
• Baird Aggregate Bond Fund (BAGIX): A high-quality bond fund paying monthly dividends with a yield of around 3.8%.
• Blackstone Mortgage Trust (BXMT): A high-yield dividend stock with a yield of over 10%.
• Causeway International Value Fund (CIVIX): Investing in companies outside the US, with a focus on developed markets.
• iShares MSCI EAFE ETF (IEFA): Tracking an index of large, mid-, and small-cap companies from developed markets outside the US and Canada.
• Nvidia Corporation (NVDA): A leader in AI, paying quarterly dividends and boasting a 178% gain in 2024.
• Schwab Target Index Fund 2060 (SWYNX): A target-date mutual fund for investors planning to retire by 2060.
• Schwab U.S. Dividend Equity ETF (SCHD): Tracking the Dow Jones U.S. Dividend 100 Index, exposing investors to top dividend stocks.
• JPMorgan Nasdaq Equity Premium Income ETF (JEPQ): A high-yield covered call ETF distributing monthly dividend income.

Capitalizing on High-Yield Opportunities

The current interest rate environment presents an exceptional chance for income-seeking investors to earn substantial yields. Private market real estate investments, such as the Ascent Income Fund from EquityMultiple, offer stable income from senior commercial real estate debt positions, with a historical distribution yield of 12.1% backed by real assets. With flexible liquidity options and payment priority, this fund is an attractive option for income-focused investors. First-time investors can now invest with a reduced minimum of just $5,000.