From Morningstar:

Investors can generate income through stock dividends, but building a dividend portfolio is complex. One solution is using Morningstar indices and monitoring it monthly.

Yield is crucial, but sustainability and consistency are also important in constructing a dividend portfolio. High yield may not be sustainable due to financial problems.

A strong long-term total return is essential in a dividend portfolio. Company valuation plays a significant role in achieving this.

A global dividend portfolio was constructed using four different dividend-focused global equity indices developed by Morningstar.

To be included in the portfolio, a security must appear in at least two indices and meet valuation criteria of a P/FV below 0.85.

The portfolio will be reviewed monthly to account for changes in indices and company valuations.

Companies must meet criteria for sector diversification and valuation to be included in the portfolio.



Read more: How to Build a Dividend Stock Portfolio