Is Vanguard High dividend yield ETF a good investment? (2024)

Is Vanguard High dividend yield ETF a good investment?

Here's the bottom line: The Vanguard High Dividend Yield ETF is unlikely to beat the S&P 500 over long periods of time. However, its value-focused composition led to outperformance during the last bear market, and it pays an above-average yield.

Is Vanguard High dividend yield Index Fund a good investment?

Key Data Points. The allure of VYM lies in its yield, which stands at an impressive 2.82%, surpassing the average yield among large-cap stocks (2.2% average) and the S&P 500 index (1.35%). This fact makes it an attractive option for income-seeking investors.

Which Vanguard ETFs pay the highest dividends?

How often does Vanguard High dividend yield ETF pay dividends?

VYM Dividend Information

The dividend is paid every three months and the last ex-dividend date was Mar 15, 2024.

Are high dividend yield ETFs good?

Dividend-paying ETFs can be a great tool for those looking to increase cash flow and diversify their investments. They offer a simple solution to getting exposure to a specific investing niche — in this case, stocks that pay a regular dividend. You can use those dividends to pad your income as many retirees do.

What are the cons of high dividend ETF?

Cons. No guarantee of future dividends. Stock price declines may offset yield. Dividends are taxed in the year they are distributed to shareholders.

What is the best high yield dividend ETF?

What is the annual return of Vanguard high dividend yield ETF?

The Vanguard High Dividend Yield ETF has achieved a total return of 298% since its inception on Nov. 10, 2006, which is equivalent to an annual return of 8.25%.

What is the best ETF to buy in Vanguard?

How many dividend ETFs should I invest in?

Experts agree that for most personal investors, a portfolio comprising 5 to 10 ETFs is perfect in terms of diversification.

Why invest in high dividend ETF?

Dividend ETFs are ultra-cheap, they can reduce overall portfolio risk and they account for a surprisingly large percentage of total returns. Dividend ETFs are ultra-cheap, they can reduce overall portfolio risk and they account for a surprisingly large percentage of total returns.

Can you live off dividends?

But with the right stock portfolio, you can enjoy peace of mind as you live entirely off the dividend payments you earn. It sounds too good to be true – but it's entirely possible, and people around the world are doing it right now. You can too – it just takes a bit of education and the right tools.

Is it wise to invest in VOO?

Vanguard S&P 500 ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, VOO is a great option for investors seeking exposure to the Style Box - Large Cap Blend segment of the market.

Is it better to buy dividend stocks or dividend ETFs?

Dividend ETFs or Dividend Stocks: Which Is Better? Dividend ETFs can be a good option for investors looking for a low-cost, diversified and reliable source of income from their investments. Dividend stocks may be a better option for investors who prefer to choose their own investments.

Is a high dividend yield risky?

A high dividend yield can be appealing since you're getting more income per dollar invested, but a high yield isn't always a positive thing. It could mean that the company's stock price has been falling or dividend payments have been increasing at a higher rate than the company's earnings.

What is the downside of high dividend stocks?

“One mistake to avoid,” Cabacungan says, “is to buy a company's stock simply because it issues a high dividend.” If the company has leveraged excessive debt to fund the dividend, it could come at the expense of future profitability and hurt growth prospects.

What is the downside of owning an ETF?

ETFs are subject to market fluctuation and the risks of their underlying investments. ETFs are subject to management fees and other expenses. Unlike mutual funds, ETF shares are bought and sold at market price, which may be higher or lower than their NAV, and are not individually redeemed from the fund.

Are ETFs more risky than stocks?

ETFs are less risky than individual stocks because they are diversified funds. Their investors also benefit from very low fees.

What is a potential drawback of investing in an ETF?

ETFs are baskets of stocks or securities, but although this means that they are generally well diversified, some ETFs invest in very risky sectors or employ higher-risk strategies, such as leverage.

What is the average dividend yield for Vanguard High dividend yield ETF?

The Vanguard High Dividend Yield ETF has historically produced a total compound annual return of 8.53% since its inception. While the returns of dividend stocks can fluctuate for any number of reasons, the historical return since its inception in 2006 is a good estimate of what to expect.

Does Vanguard have a high yield ETF?

The Vanguard High Dividend Yield ETF has achieved a total return of 8.25% annually since its inception in 2006, and it paid an average dividend yield of 3.02% over the past decade.

Do any Vanguard funds pay monthly dividends?

Key Takeaways. Vanguard is a large investment advisor offering mutual funds and ETFs, many of which pay dividends. Most of Vanguard's ETF products pay monthly or quarterly dividends. Expense ratios are the fees investors pay for investing in a fund; the lower the better.

Does Vanguard do high yield savings?

High interest rate. With a rate of 4.70% APY, the Vanguard Cash Plus Account rivals the rates found on many high-yield savings accounts. No minimum balance requirement. The account doesn't require customers to maintain a minimum balance to keep the account open.

What is a good dividend yield?

The average dividend yield on S&P 500 index companies that pay a dividend historically fluctuates somewhere between 2% and 5%, depending on market conditions. 7 In general, it pays to do your homework on stocks yielding more than 8% to find out what is truly going on with the company.

Is Vanguard or Fidelity better for ETFs?

Both Fidelity and Vanguard have a wide variety of low-cost mutual funds and ETFs. If you're simply looking at the options offered by each firm, Fidelity has more options available.