Investors are often drawn to the high dividends or income streams of SCPIs (French real estate investment trusts). However, in the long run, are these strategies truly more profitable than a growth ETF? In this article, "High Dividends, SCPI Income, or Growth ETF: What Do the Numbers Really Say?", we objectively compare SCPIs, dividend ETFs, and growth ETFs to determine which strategy performs best over time.
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Growth ETF vs. Dividend ETFs
⚠️ The returns shown are approximate historical averages and may vary depending on the period. Investing involves the risk of losing money! This article is for educational purposes only and does not constitute investment advice.
Differences in investment strategy between high-dividend ETFs, SCPIs, and growth ETFs
First, it is important to understand that Investors who put their money into a high dividend ETF, a fully owned SCPI or a growth ETF do not have the same financial objective. To sum up:
- SCPI or dividend-paying ETF In this case, the investor favors a high monthly income or high dividends on a regular basis. Their goal is to earn a high monthly or quarterly income.
- Growth ETFs In this case, the investor prioritizes long-term capital growth in their financial assets. Their goal is to earn more money compared to a high-dividend strategy.
In reality, The investor with a SCPI or a dividend ETF wants regular income, while the investor who chooses a growth ETF seeks to increase their capital over the long term by accumulating compound interest.
In this article, High Dividends, SCPI Income or Growth ETF: What Do the Numbers Really Say? We will detail the advantages and disadvantages of investing in each investment strategy.
Strategies for this article
For this article, I have selected the following strategy:
- SCPI = Corum Origin*
- High-dividend ETF = VHYL ETF*
- Growth ETF (mixed) = SP500 ETF (VOO)*
- Growth ETF (high growth) = Nasdaq 100 ETF (QQQ)*
The strategies I've selected aren't investment advice. They're simply examples with a history of interesting returns for this investment category 😎
Past performance: Dividend ETFs vs. Growth ETFs
It should be noted that past profitability does not predict future returns. However, it is natural to inquire about the past profitability of each investment.
Here is a table to understand the profitability of each investment from the end of 2015 to the end of 2025:
| Annualized return in USD 2015-2025 (approximate) | |
|---|---|
| Corum Origin SCPI | 8% in Euros (7.5% in USD) |
| ETF VHYL (high dividends overall) | 8,5% |
| ETF VOO (SP500) | 14,5% |
| ETF QQQ (Nasdaq 100) | 19.5% |
👉 Therefore, if we only compare pure profitability, A growth strategy is undoubtedly the most profitable in the long term. compared to a SCPI or high dividend strategy.
The percentage in dividends and the percentage in growth
Here is a summary of the percentage of each investment, analyzing dividends received and growth:
| Investment | % annual received in dividends | % annual received in growth | Annualized return in USD 2015-2025 (approximate values) |
|---|---|---|---|
| Corum Origin SCPI | 6% | 2% | 8% in Euros / (7.5% in USD) |
| ETF VHYL (high dividends overall) | 4% | 4,5% | 8,5% |
| ETF VOO (SP500) | 1,4% | 13,1% | 14,5% |
| ETF QQQ (Nasdaq 100) | 0.5% | 19% | 19.5% |
👉 Unsurprisingly, a high-dividend SCPI and ETF distribute higher dividends than a growth ETF. However, a growth ETF, although it distributes smaller dividends, offers higher returns over the long term!
Diversification: SCPI or dividend ETF VS growth ETF
Regarding diversification, although this is debatable, here is a summary of the investments in each financial asset:
| Investment | |
|---|---|
| European SCPI | Investing in real estate on a European scale |
| ETF VHYL (high dividends overall) | Investing in the stock market, in a diversified and global manner. |
| ETF VOO (SP500) | Stock market investment, diversified and exclusively in the USA |
| ETF QQQ (Nasdaq 100) | Stock market investment, diversified and exclusively in the USA |
Here is a summary of the number of placements for each investment:
| Invest | Diversified or sector-specific investment? | Investment region | Number of shares / real estate investments (approximate) |
|---|---|---|---|
| European SCPI | Only in the real estate sector | Europe | 164 (Real estate assets) |
| ETF VHYL (high dividends overall) | Investing in thousands of diversified stocks | Global | 2,200 |
| ETF VOO (SP500) | Investing in 500 diversified US stocks | USA | 500 |
| ETF QQQ (Nasdaq 100) | Investing in 100 diversified US stocks | USA | 100 |
👉 Therefore, if we analyze only diversification, in my opinion, here is the order by investment:
- ETF VHYL
- ETF SP500
- Nasdaq ETF
- SCPI
Taxation and its impact on investment
Taxes vary from country to country. But in summary, here's an estimate of how much an investor will pay per investment:
- SCPI
- French SCPI = Between 30 and 47% in taxes on real estate income
- European (non-French) SCPI = Between 13 and 30% in taxes on real estate income
- Taxation on the growth of the SCPI = 0% (In Switzerland, private capital gains are exempt from tax.)
-> We conclude that, with regard to SCPIs (French real estate investment trusts), taxation depends on the investor's country of tax residence and the applicable tax treaties. In fact, in many cases, a non-French SCPI can offer more advantageous tax treatment, depending on the country of tax residence and the tax treaties in place.
- AND F
Regarding ETFs, taxation in Switzerland is generally as follows:
- Stock market growth = 0% (In Switzerland, private capital gains are tax-exempt.)
- Dividends = 14-28%
Note that in Switzerland, dividend taxation varies between 0 and 28% depending on the dividend's origin. However, once the forms are completed (W-8BEN, for example), and the tax return is filed, all dividends are ultimately subject to 14% of the dividend received.
I came up with an example, I simulated 4 investors who earned $10,000 USD depending on the investment.
| Invest | Income from dividends / annuities | Growth income | |
|---|---|---|---|
| Louis | French SCPI | 8000 USD | 2,000 USD |
| François | European SCPI (not French) | 8,000 USD | 2,000 USD |
| Maria | ETF VHYL (high dividends overall) | 5,000 USD | 5,000 USD |
| Vitor | ETF VOO (SP500) | 1,500 USD | 8,500 USD |
| Jo | ETF QQQ (Nasdaq 100) | 500 USD | 9,500 USD |
We see that the four people each receive $10,000 USD. However, how much will they pay in taxes?
| Invest | Income from dividends / annuities | Growth income | Total taxes payable | |
|---|---|---|---|---|
| Louis | French SCPI | 2,400 USD (30%) | 0 USD | 2,400 USD |
| François | European SCPI (not French) | 1,600 USD (20%) | 0 USD | 1,600 USD |
| Maria | ETF VHYL (high dividends overall) | 700 USD (14%) | 0 USD | 700 USD |
| Vitor | ETF VOO (SP500) | 210 USD (14%) | 0 USD | 210 USD |
| Jo | ETF QQQ (Nasdaq 100) | 70 USD (14%) | 0 USD | 70 USD |
👉 We conclude that, from a tax perspective, it is better to choose a growth ETF rather than a SCPI or a high-dividend ETF. !
Volatility and Stability of Returns: Dividend-Paying SCPIs or ETFs vs. Growth ETFs
If we analyze the volatility and stability of the return, we can summarize it as follows:
| Invest | Dividends | Price volatility |
|---|---|---|
| European SCPI | Very high | Very weak |
| ETF VHYL (high dividends overall) | students | Weak |
| ETF VOO (SP500) | Weak | Strong |
| ETF QQQ (Nasdaq 100) | Very weak | Very strong |
👉 We conclude that, with regard to price volatility and performance stability, here is the ranking:
- SCPI
- High Dividend ETFs
- Growth ETFs
Buying and selling commissions
It should be noted that fees will vary depending on the ETF or SCPI. However, without taking taxes or inflation into account, here are the fees to expect:
| Invest | TER ETF or SCPI management fees | Entry or exit fees | Investment in a foreign currency | Trading account fees | Total annual commission (estimate) |
|---|---|---|---|---|---|
| European SCPI | 0%* | Variable depending on the SCPI *2 | 0.5% | 0% | ∽ 1% |
| ETF VHYL (high dividends overall) | 0.30% | 0% | 0.5% | 0.5% | ∽ 1.3% |
| ETF VOO (SP500) | 0.03% | 0% | 0.5% | 0.5% | ∽ 1.03% |
| ETF QQQ (Nasdaq 100) | 0.20% | 0% | 0.5% | 0.5% | ∽1,20% |
* – SCPI management fees are included in the advertised return, which explains why they are not added separately.
*2 – Some SCPIs do not charge entry or exit fees. However, at the time of writing, the majority of SCPIs have entry fees (generally 8 to 10 %, included in the holding period).
👉 In conclusion, we find that all investments have annual fees of approximately 1%. However, it's worth noting that the fee will be heavily influenced by the SCPI's commission or the trading account's commission!
Simplicity of investment: SCPI vs. dividend ETF vs. growth ETF
👉 Regarding the simplicity of investing, it's worth noting that a SCPI, a high-dividend ETF, or a growth ETF are very simple investments and only require 5 minutes of investment time per month. 😉
What is the best investment to start with?
👉 Investing in one of the 4 options is an excellent way to start investing your money! However, this is only true if you choose the right SCPI or ETF.
Note that investing early in a mixed growth ETF (the S&P 500 for example) is regularly synonymous with high profitability and stock market diversification.
High dividends, SCPI income or growth ETFs: what do the figures really say?
Conclusion: High dividends, SCPI income or growth ETFs: what do the figures really say?
Here is a summary to help you conclude which investment is more profitable: high dividends or growth ETFs?
| The best investment? Growth ETF VS high dividends | |
|---|---|
| The one that achieved the best gross return over a long period? (more than 5 years) | Growth ETFs |
| The one that pays the best dividends? | High dividends (mainly SCPIs) |
| Which investment distributes dividends most regularly? | High dividends (some SCPIs distribute dividends monthly) |
| The one with the better tax rate? | Growth ETF! |
| The most diversified investment? | According to ETF |
| The most financially stable investment? (less price volatility) | High dividends (Mainly SCPIs) |
| The one who demands the most commissions (without taking into account taxes or inflation)? | Similar |
| Which one is the easiest to invest in and manage? | Similar (very simple!) |
| The best investment to start with? | ETF SP500 |
Key takeaways from this article!
- Dividends provide stability and regular income, but reduce returns over the long term.
- Growth maximizes profitability in the long term
- Taxation favors growth ETFs
- Regardless of the investment, diversification remains key.
Dividends or growth: what do the figures say?
The figures show that, over several decades:
- there capital growth surpasses dividend strategies,
- especially when one takes into account the taxes and costs.
In summary, we can conclude this article with this quote:
”Dividends provide reassurance, growth brings wealth.” 🤑
Dividends or growth: Is it possible to combine the two strategies?
Yes, why not?
However, it's worth noting that shareholders generally favor either growth or high, regular dividends. Combining both stabilizes financial assets!
In reality, from the moment a shareholder with a growth strategy buys SCPIs or ETFs with high dividends. He:
- It will lose profitability in the long term
- This will stabilize the portfolio's value (less volatility).
- Will pay more income tax
- Will increase its dividends
Conversely, a shareholder with a high-dividend strategy who buys a growth ETF. He:
- Will increase its yield in the long term
- Will destabilize the portfolio's value (increased volatility)
- Will pay less income tax
- Will reduce its dividends
👉 Combining the two strategies diversifies the investment. However, this will affect the portfolio's return, volatility, and dividends. 🤭
AI FAQ – High Dividends, SCPI or Growth ETF
🔹Growth ETF or dividend ETF: which is more profitable?
-> In the long term, the Growth ETFs are generally more profitable than dividend ETFs. The reason is simple: Dividends reduce invested capital, while growth fully benefits from compound interest.
🔹 Why do dividends seem reassuring but reduce performance?
Dividends bring a regular income, which is psychologically reassuring.
However, each dividend paid is imposed And withdrawn from capital, which slows down the overall growth of the portfolio in the long term.
🔹 Are SCPIs less profitable than ETFs?
On average, yes.
THE SCPIs offer stable income, but their overall profitability is often lower than that of growth ETFs, due to:
- of a heavier taxation,
- of entrance fees,
- of a limited capital growth.
🔹 Is it possible to live solely on dividends?
Yes, but this requires:
- A very high capital,
- a optimized taxation,
- and the acceptance of a lower yield in the long term.
For many investors, a phase of growth first, then of returned later, is more effective.
🔹 Why are growth ETFs more tax-efficient?
In many countries, including Switzerland:
- THE stock market capital gains are not imposed,
- while the dividends are immediately.
A growth ETF therefore allows you to deferring tax, which greatly improves net performance.
🔹 Are dividend ETFs useless?
No.
They may be of interest for:
- investors nearing retirement,
- those who are looking for a regular income,
- or a psychological stability.
But they are less optimal to maximize wealth in the long term.
High dividends, SCPI income or growth ETFs: what do the figures really say?
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High dividends, SCPI income or growth ETFs: what do the figures really say?
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