It's easy to find passive income on the market by simply purchasing dividend stocks. Load up on some high-yield dividend payers, and you can achieve a quick 3% return (or more) right from the start. This yield will likely grow from there as the stocks boost their dividends over the years. Procter & Gamble has hiked its payout for more than 60 consecutive years, for example.

It's not easy to build a portfolio of these dividend stocks, though. Reaching for high yields can be a risky strategy, for one, since these elevated rates tend to be attached to businesses that are going through operating challenges or are hampered by sluggish growth prospects. It's always possible to pick a company that ends up being squashed by competition, too.

That's where an exchange-traded fund (ETF) makes sense as an investment option. Buying a single ETF can deliver the diversification you need in addition to exposure to whatever market sector you are targeting.

Continue reading

Source Fool.com