If you want to buy and hold dividend ETFs that won't disappoint you over the long run, it's a good idea to look at iShares Select Dividend ETF (NASDAQ:DVY), Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO), and Vanguard Dividend Appreciation Index Fund ETF (NYSEARCA:VIG).
There are many different exchange-traded fund (ETF) providers in the industry, but Vanguard stands out as one of the best.
Making its debut on 04/21/2006, smart beta exchange traded fund Vanguard Dividend Appreciation ETF (VIG) provides investors broad exposure to the Style Box - Large Cap Blend category of the market.
Compared to Invesco QQQ Trust ETF, Vanguard Dividend Appreciation ETF also offers substantial tech exposure but at more attractive valuation metrics. Thanks to its tech exposure, VIG has demonstrated growth rates close to QQQ in the past, both far exceeding other major market indices such as the Dow Jones and S&P. Both VIG and QQQ display similar PEG ratios, but P/E ratios and dividend yields suggest far lower risks for VIG.
As investors look to year-end and into 2026, the appeal of dividends lies not only in income but also in stability through uncertainty. When evaluating dividend stocks, I strive to look beyond headline yields and look for quality, as defined by dividend safety and supportive Factor Grades. This basket of five stocks has an average dividend yield of 3.96%, well above the 1.15% for the S&P 500 and 1.65% for the Vanguard Dividend Appreciation Index ETF (VIG).
The Vanguard Dividend Appreciation Index Fund ETF offers strong long-term potential due to its tech sector overweighting and exposure to AI-driven Data Center growth. VIG's portfolio benefits from major investments by companies like Nvidia, Oracle, and Broadcom, positioning the ETF for outperformance in a robust Q3 tech earnings season. Compared to SCHD, VIG has a higher IT weighting, and a lower expense ratio, but slightly lower 5-year dividend growth.
The S&P 500 could crash on renewed trade war fears if the tension is not resolved soon. ETFs, such as VIG, DGRO, CCOR, TSPY, XYLD, USMV, GLD, SLV & XLP, could help weather the volatility.
VIG is the largest dividend ETF in the market, but it sure doesn't look like a traditional dividend ETF. A market cap weighting strategy is helping pull several mega-cap tech names into the top 10 holdings despite having minimal yields. VIG's tech sector allocation is nearly double that of a dividend ETF benchmark.
Dividend ETFs offer cash flow and diversified holdings. You don't have to stay up late at night researching dividend stocks to get respectable returns and extra income.
These VIG dividend stocks have high yields and regular payouts. Their yields outpace the Federal Reserve's long-term target.
VIG offers tech concentration, strong NAV growth, and consistent dividend increases, making it a core long-term holding for wealth building. The ETF's technology overweighting positions VIG to benefit from accelerating AI adoption and Data Center CapEx trends. VIG has outperformed SCHD in 10-year NAV returns and matches its impressive 3-year dividend growth, despite a challenging inception period.
VIG's yield spread over VOO is near a 10-year high, indicating an unusually attractive reward/risk ratio for VIG relative to the broader market. Moreover, VOO faces heightened valuation risk due to elevated Treasury yields, with its excess yield at the thinnest level since 2002. Besides yield spreads, VIG is also attractive in a few other aspects.