High-Stakes Investor with $1.7m Chooses Schd over Diversification – Is His $288,750 Annual Profit Pr
The investor's decision to put the entire sum into Schwab U.S. Dividend Equity ETF (SCHD) is driven by his desire for reliable income and growth through reinvestment. He projects an annual profit of $288,750 from dividends, covered calls, and capital gains, but acknowledges that this calculation does not account for reinvested earnings or potential losses. By focusing on a single ETF, the investor aims to simplify his investment strategy.
- The investor's reliance on SCHD highlights the tension between risk management and diversification in high-stakes investing, where some investors prioritize simplicity over broad market exposure.
- What role do alternative income streams, such as dividend-paying stocks or real estate investments, play in the investor's overall portfolio strategy, and how might they mitigate potential risks associated with concentrated ETF holdings?