This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Dividend Dog Investing Goes Global

Spain's Banco Santander (SAN) is one of the financial stocks in IDOG. SAN yields 12%, but the stock is down 26% since its January high, far worse than the 15% decline for the iShares MSCI Spain ETF (EWP).

IDOG holding France Telecom (FTE) (with a 10% yield) is down 21% from its January peak compared to a 3% decline for the iShares MSCI France ETF (EWQ).

Even though those are just examples and not every stock in the fund has that kind of yield, there comes a point in dividend investing where a yield can be too high.
[Read: <a target="blank" data-add-tracking="true" href=""><em> 10 Most American-Made Cars of 2013</em></a>]

A very high yield can often be an indication of a distressed company that might soon cut its dividend. A strategy of buying distressed companies in hopes of a turnaround is valid. but it might not be what a person looking at dividend ETFs has in mind.

The dividend dog theory is sound, but if equity markets in Europe and Japan continue to struggle, then it is unlikely that IDOG can do well.

At the time of publication, Nusbaum had no positions in stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
EFA $58.43 -0.43%
SDOG $39.47 -0.83%
IDOG $24.22 -0.45%
AAPL $93.74 -1.15%
FB $118.00 1.10%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs