If you own the DGRO exchange-traded fund (ETF), you may be wondering how to effectively build around it with your investing strategy. DGRO is known for its focus on dividend growth, making it a valuable asset in a diversified portfolio. Here are some tips on how to enhance your investment approach with DGRO as the foundation.
First and foremost, it’s important to understand the role that DGRO plays in your portfolio. As a dividend growth ETF, DGRO provides steady income and long-term growth potential. With this in mind, consider complementing DGRO with other assets that offer different types of exposure, such as growth stocks or value stocks.
One way to build around DGRO is to diversify across different sectors. By investing in sectors that are not heavily represented in DGRO, you can further spread out your risk and potentially enhance returns. For example, if DGRO is heavy on technology and consumer staples, you may want to consider adding exposure to sectors like healthcare or industrials.
Another strategy is to look for investments that have low correlation with DGRO. By adding assets that move independently of each other, you can reduce overall portfolio volatility. This could include assets like real estate investment trusts (REITs) or commodities.
Lastly, consider the overall risk profile of your portfolio when building around DGRO. If DGRO is already a conservative investment, you may want to add more aggressive assets to balance out your risk exposure. On the other hand, if DGRO is your main growth component, you may want to add more defensive assets to protect against market downturns.
In conclusion, owning DGRO can be a solid foundation for your investment portfolio. By strategically building around it with complementary assets, you can enhance diversification and potentially improve your overall returns. Remember to review your portfolio regularly and make adjustments as needed to ensure it remains aligned with your investment goals.