Vanguard Dividend Appreciation pulls in stable, profitable firms that have consistently increased their dividends for over a decade. Its established constituents insulate the portfolio from volatility and should lead to a long-term risk-adjusted advantage. Its U.S. and Canadian share classes earn Morningstar Medalist Ratings of Gold.

This strategy tracks the S&P US Dividend Growers Index, which targets U.S. stocks that have increased their dividend payments for at least 10 consecutive years. It eliminates the highest-yielding names from that cohort to ensure its holdings are financially stable and more likely to continue making dividend payments. The index weights its holdings by their free-float-adjusted market cap, which leverages the market’s collective wisdom and helps mitigate turnover and associated trading costs. It also limits individual stocks to 4% of the portfolio at the annual rebalance to promote diversification.

Targeting stocks with 10 years of dividend growth is a strict hurdle that provides a big advantage. It indirectly targets profitable companies that not only have the capacity to increase their dividend payments but also a willingness to do so. Combining yield and quality results in a balanced stable of more than 300 companies. However, if a company were to miss a single dividend payment, it would have to wait 10 years before it is welcomed back. For example, Apple AAPL and ExxonMobil XOM recently joined the portfolio after a decade of increasing dividends. Still, this is a worthwhile trade-off that keeps the portfolio full of high-quality companies that should continue to increase their dividends.

The strategy’s strict requirements tend to weed out recent highflyers like Tesla TSLA and Nvidia NVDA. These omissions can cause diverging performance relative to large-blend peers in the short term, but this strategy should result in smoother and more consistent performance over the long run. Likewise, excluding the highest-yielding eligible stocks reduces the portfolio's exposure to value traps without giving up the fund’s yield advantage over the broad market.

A portfolio of high-quality, stable companies should be tough to beat on a risk-adjusted basis over the long haul. This fund's low expense ratio of 0.06% further carves out a durable edge.

Analyst Rating

A steady approach to higher yield.

Director

Bryan Armour

Microsoft

Apple

UnitedHealth Group

Exxon Mobil

JPMorgan Chase & Co

Visa

Johnson & Johnson

Procter & Gamble

Broadcom

Mastercard

These portfolios consist of high-quality, stable companies that should provide strong performance, earning an upgrade to a Process Pillar rating of High from Above Average.

High

Process

Vanguard Equity Index Group boasts seasoned managers and a dedicated supporting staff well-equipped to provide tight index tracking. This well-supported team earns an Above Average People rating.

Gerard O’Reilly and Walter Nejman comanage this strategy. O’Reilly, a Principal at Vanguard, has been with the firm since 1992. Nejman has been with Vanguard since 2008. They both started on the strategy in 2016 to replace longtime manager Ryan Ludt as he transitioned to a different role within the firm.

The managers are responsible for the fund’s trading, providing more portfolio insights than a stand-alone trader. They are supported by a global team of dedicated personnel and sophisticated, scalable technology that optimize precision and reduce managers’ workload. Vanguard frequently rotates its managers to promote breadth and depth across the team. Its independent risk management team works closely with the managers to monitor trades and review any potential issues. Managers’ compensation is tied to performance using a combination of tracking error and excess return metrics, which aligns their interests with investors'.

Above Average

People

The Vanguard Group retains a High Parent rating. 

Mutual ownership, low costs, and a direct-to-investor playbook have helped spur Vanguard's leadership within the United States. Client service missteps notwithstanding, Vanguard over the past decade has grown its market share of U.S. open-end and exchange-traded fund assets at about a 5% annualized clip. At that rate, Vanguard's portion of the U.S. industry will cross 50% around 2035.

True, some competitors can now match or even undercut Vanguard on fees for broad market exposure. But Vanguard's burgeoning advice business could help it keep or even extend that lead. Through Digital Advisor and Personal Advisor Services, Vanguard has built an increasingly compelling ecosystem of advice for investors with simple to complex needs.

Vanguard is also using its advice business to expand overseas, but that's a work in progress. Of Vanguard's USD 7.6 trillion in global assets under management in March 2023, non-U.S. investors owned less than 10%, a figure that has changed little in recent years. Strategic shifts in China and other markets account for the slow pace, including returning money to institutions that had been layering on fees. Vanguard hopes to recoup that money and more by focusing on individual investors and the advisors who serve them. Provided Vanguard sticks to its playbook, its advantages should translate into success abroad, too.

Parent

Vanguard Dividend Appreciation ETF

VIG tracks a market-cap-weighted index of US companies that have increased their annual dividends for 10 or more consecutive years.

FlexShares Quality Dividend Index Fund

Schwab US Dividend Equity ETF

Schwab's flagship U.S. Dividend Equity ETF is an efficient and straightforward option. Vanguard's Dividend Appreciation ETF is more suitable for income investors who still want growth.

These 3 Dividend ETFs Are a Retiree's Best Friend

ProShares S&P 500 Dividend Aristocrats ETF

Dividend stocks, in general, and dividend aristocrats, in particular, have historically outperformed the market with lower volatility. The dominance of big tech in 2023 after over a decade of aristocrats lagging the S&P has caused some to ask, "Is dividend investing broken?". Actually, as NOBl and VIG, two popular aristocrat ETFs, show, the returns over the last decade are not surprising given what each ETF owns.

VIG And NOBL: One Is The Gold Standard Of Dividend Aristocrat ETFs

Broadstone Net Lease

Bank of Nova Scotia

Chimera Investment

Canadian Imperial Bank of Commerce

Cisco Systems

Diageo

GlaxoSmithKline

Haleon PLC

Illinois Tool Works

Leggett & Platt

McDonald's

MDU Resources Group

Medical Properties Trust

NetApp

Realty Income Corp

Orion Office REIT

Paramount Global

Philip Morris

Invesco S&P 500 High Dividend Low Volatility ETF

TotalEnergies SE

Vanguard S&P 500 ETF

Growing dividend income takes time and consistency. The Fed paused a rate hike in September and will likely remain in a holding pattern for November, with a modest chance of an increase in December. Increase passive income by consistently investing in the market and letting dividend reinvestment do the trick.

Dividend Income Summary: Lanny's October 2023 Summary

Global X Superdividend ETF

SPDR Portfolio S&P 500 High Dividend ETF

Big dividend yields are compelling, but there's always more to the story. There's much to be said for predictability and reliability, particularly for retirees.

These 4 Dividend ETFs Are a Retiree's Best Friend

The Vanguard Dividend Appreciation ETF has performed closely in line with the S&P500 since its inception in 2006, but should outperform in the future. VIG has cheaper valuations, is much more diversified, and has a history of lower volatility when compared with the S&P500. However, 10-year returns are likely to lag behind cash and bonds amid slowing nominal GDP growth downside mean reversion in valuations.

VIG: Dividend Growers Outperform The SPX On 3 Key Metrics

The fund dividend growth strategy does not outperform the S&P 500 or peers. VIG excludes REITs and the top 25% highest dividend stocks. Consensus estimates suggest a 9% total return potential for VIG.

VIG: No Performance Enhancement

Vanguard Mega Cap Growth ETF

Vanguard Russell 1000 Growth ETF

Vanguard is known for its low-cost ETFs and continues to offer innovative ways to grow wealth.  Diversified ETFs from Vanguard offer a simple strategy for investors seeking to attain millionaire status.

3 Vanguard ETFs That Could Make You a Millionaire

Big 5 Sporting Goods

Chewy

PetMed Express

V.F.

In response to macroeconomic challenges, numerous companies are reducing expenses to safeguard their earnings, which can sometimes involve reducing or eliminating dividends. This article highlights three dividend stocks whose weak Dividend Safety Grades were highlighted well before cuts that could have been avoided. Economic oscillation, declining earnings, inflation, and rising interest rates have pressured profits and companies' ability to maintain dividends.

Dividend Stocks: Cuts You Could Have Avoided

Alexandria Real Estate Equities

AvalonBay Communities

iShares iBoxx High Yield Corporate Bond ETF

iShares iBoxx $ Investment Grade Corporate Bond ETF

National Retail Properties

iSh SP US PrfSt Shs

Vanguard Real Estate ETF

Vanguard High Dividend Yield ETF

There are lots of opportunities for income investors right now. Treasuries and bonds are attracting a lot of capital, but they are riskier than you may think. Dividend-paying stocks and ETFs offer better risk-to-reward for most income investors. Here's why.

How To Invest $100,000 For Huge, Inflation-Beating Passive Income

Vanguard Dividend Appreciation ETF is a good option for new investors or those seeking safety and stability in a high-quality ETF. VIG has a blended portfolio structure that includes both value and growth holdings, with a focus on dividend growth. While VIG performs well in terms of total return and price appreciation, it may be outperformed by some peers in terms of total return and starting dividend yield.

VIG: A Bet On The U.S. Economy

iShares Core Dividend Growth ETF

iShares Select Dividend ETF

Schwab Fundamental U.S. Large Company Index ETF

SPDR S&P Dividend ETF

That's not a typical reaction, either from advisers or investors, especially when a group of stocks has underperformed the broad market by double-digit amount s— as many dividend-stock funds and ETFs have done over the last 12 months. But history suggests that these strategies could very well bounce back in a big way in coming months.

These dividend stocks and ETFs have healthy yields that can lift your portfolio

Automatic Data Processing

Applied Materials

Amphenol

BlackRock

Costco

Cintas

Graco

Home Depot

Intuit

Jack Henry & Associates

Lowe's

Monolithic Power Systems

Northrop Grumman

Roper Technologies

Charles Schwab

Sherwin-Williams

Tractor Supply

There are 20 stocks on my dividend growth watchlist for October 2023. The majority of the stocks on my watchlist are undervalued based on dividend yield theory. An equally weighted portfolio of these stocks would have outperformed the Vanguard Dividend Appreciation ETF by more 4% year-to-date.

Dividend Growth Stock Watchlist - November 2023

Schwab U.S. Dividend Equity ETF and Vanguard Dividend Appreciation Index Fund ETF Shares are attractive choices for passive income investors seeking diversified portfolios of high-quality dividend-paying stocks. Vanguard Dividend Appreciation Index Fund ETF Shares offers low expense fees and a focus on companies with a history of dividend growth. Schwab U.S. Dividend Equity ETF has a higher yield and stronger long-term returns, making it a superior value proposition.

2 Reasons Why SCHD Is A Better ETF Pick Than VIG

The Vanguard Dividend Appreciation ETF (VIG) made its debut on 04/21/2006, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.

Is Vanguard Dividend Appreciation ETF (VIG) a Strong ETF Right Now?

Ares Management

Caterpillar

Cigna

Coterra Energy

CubeSmart

Deere & Company

EOG Resources

Kinsale Capital Group

McKesson

NXP Semiconductors

Old Dominion Freight Line

PulteGroup

Vulcan Materials

Zoetis

We pick high-growth dividend stocks that have rapidly grown their dividends in the recent past rather than offering a high current yield. We use our proprietary models to rate quantitatively and qualitatively and select the top ten names from an initial list of nearly 400 dividend stocks. We provide criteria for selecting high-growth dividend stocks, offering a step-by-step guide on structuring a portfolio based on this strategy.

Our Top 10 Picks For Dividend Growth Stocks - October 2023

Vanguard International Dividend Appreciation ETF

Morningstar has identified four dividend funds that hold quality companies and have a proven record.

4 Dividend ETFs That Are 'Best in Class'

VIG: A Diversified, Low-Price Option For Dividend Growth Investors

Advance Auto Parts

Newell Brands

SPDR S&P 500 ETF Trust

W. P. Carey

Dividend stocks are still attractive despite high money market yields. Chasing high dividend yield stocks can be risky. Focus on dividend growth and safety when selecting dividend stocks.

Dividends For A Sliding Market With Steven Cress

There are 18 stocks on my dividend growth watchlist for October 2023. More than half of the stocks on my watchlist are undervalued based on dividend yield theory. An equally weighted portfolio of these stocks would have outperformed the Vanguard Dividend Appreciation ETF by nearly 7% year-to-date.

Dividend Growth Stock Watchlist - October 2023

ALPS Barron's 400 ETF

iShares S&P 500 Value ETF

iShares Russell 1000 Value ETF

Simplify Interest Rate Hedge ETF

iShares MSCI USA Quality Factor ETF

Global X Interest Rate Hedge ETF

Advocate Rising Rate Hedge ETF

Invesco S&P 500 Low Volatility ETF

iShares Edge MSCI Min Vol USA ETF

Vanguard Value ETF

Given the current market environment, we have highlighted some investing strategies for the fourth quarter that could prove to be extremely beneficial for investors.

5 Winning ETF Strategies for Q4

Building a successful portfolio starts with a strong foundation and diversification. Vanguard Dividend Appreciation Index Fund ETF is the largest dividend-focused ETF with a strong track record. Schwab US Dividend Equity ETF has underperformed recently, but could benefit from a broad rally in Q4.

SCHD Vs VIG: Which Is The Better Dividend ETF?

Siren DIVCON Leaders Dividend ETF

ProShares Russell 2000 Dividend Growers ETF

Dividend growth outperforms the market over time and helps portfolios beat inflation. These dividend growth ETFs give investors the chance to buy the strategy in bundles.

6 Dividend Growth ETFs to Buy

The Vanguard Dividend Appreciation ETF is a passively managed ETF that focuses on large-cap US stocks that have grown their dividends annually for at least 10 straight years. We pick out VIG's standout qualities in relation to NOBL. Despite some admirable structural qualities, we outline a few reasons why VIG may not be a good BUY at current levels.

VIG ETF: Better Than Its Largest Peer, But Not Quite A Buy

Both of these dividend ETFs focus on rising dividends.

2 of the Best Dividend ETFs You Can Buy

Bank of America

Discover

Domino's Pizza

Microchip Technology

MSCI

Sirius XM Hlds

SS&C Technologies Hlds

Skyworks Solutions

Texas Instruments

W. R. Berkley

September has historically been a bad month for equities, with the SPDR S&P 500 Trust ETF and Vanguard's Dividend Appreciation ETF both posting losses during the last 4 Septembers. The top 15 dividend growth stocks for October offer an average dividend yield of 1.94% and appear to be about 35% undervalued based on dividend yield theory. Since inception, September 2020, the watchlist is outperforming VIG by 2.92% and SPY by 2.34%, on an annualized basis.

My Top 15 High Growth Dividend Stocks For October 2023

News for Vanguard Dividend Appreciation ETF ETF (VIG)