If you're looking for a broad stock market investment that will also deliver dividend income to you, you might want to consider the Vanguard Total Stock Market ETF (VTI 0.14%). It's an exchange-traded fund (ETF), which means it's a fund that trades like a stock. It's also an index fund, encompassing not just the 500 big American companies in the S&P 500 index but just about all of the U.S. stock market -- more than 3,600 stocks.
The Vanguard Total Stock Market ETF pays dividends, too, and recently sported a dividend yield of 1.2% -- but whereas most healthy and growing companies pay a fixed dividend amount until they increase it, this ETF's payout fluctuates a fair amount, as the companies in it change what they pay.
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But let's assume a 1.2% yield. If you invest, say, $1,000, you'll receive around $12. So to collect $500 in dividend income, you'd need about 42 times that -- meaning a stake worth roughly $42,000. That would mean some 130 shares.
To be clear, you can collect much more in dividend income from various high-yield stocks and even some good dividend-focused ETFs. But the Vanguard Total Stock Market ETF can still serve a useful role in your long-term portfolio, having you invested in pretty much the entire U.S. market -- and, therefore, most of the U.S. economy -- including stocks from Amazon (NASDAQ: AMZN) to ZIM Integrated Shipping Services (NYSE: ZIM). So if you're bullish on the future of e-commerce and international trade, not to mention scores of other businesses, this ETF has you covered. (Note that there are reports that ZIM may be taken private. And Amazon investors are expecting its investments in artificial intelligence to make it even more efficient.)
It has more to recommend it, too, such as a low expense ratio (annual fee) of just 0.03%, costing you $3 per $10,000 invested per year.
