The Best Vanguard Dividend Funds – 4 Popular ETFs

Dividend funds are a popular way to access immediate diversification with dividend stocks. Vanguard has some of the lowest-cost ETFs around. Here we'll explore the best Vanguard dividend funds.

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In a hurry? Here's the list:

1. VIG – Vanguard Dividend Appreciation ETF
2. VYM – Vanguard High Dividend Yield ETF
3. VIGI – Vanguard International Dividend Appreciation ETF
4. VYMI – Vanguard International High Dividend Yield ETF

Video

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Introduction – Why Dividend Stocks?

Dividend stocks are popular amongst income investors and retirees looking to use dividends as regular income. Others seek companies with a historically growing dividend as a sign of a strong, stable company in which to invest. Dividend stocks have been a way to access factor premia such as Value and Quality that have achieved market outperformance over time.

Let's dive into the 4 best Vanguard dividend ETFs.

The 4 Best Vanguard Dividend Funds

Vanguard offers 4 dividend-oriented ETFs, 2 focused on U.S. companies and 2 international:

VIG – Vanguard Dividend Appreciation ETF

Vanguard's Dividend Appreciation ETF is the most popular of these 4, with over $45 billion in assets. This fund focuses on dividend growth stocks – companies with an increasing dividend payment for at least 10 consecutive years. The fund seeks to track the NASDAQ US Dividend Achievers Select Index, formerly known as the Dividend Achievers Select Index. This ETF has an expense ratio of 0.06%.

VYM – Vanguard High Dividend Yield ETF

If you're more concerned with high yield, the Vanguard High Dividend Yield ETF has you covered. It seeks to track the FTSE® High Dividend Yield Index, providing access to high dividend yield stocks, excluding REITs. This fund has over $25 billion in assets and an expense ratio of 0.06%. I compared the specifics of VIG and VYM here if you're interested.

VIGI – Vanguard International Dividend Appreciation ETF

VIGI is simply the international (ex-US) version of VIG. The Vanguard International Dividend Appreciation ETF seeks to track the NASDAQ International Dividend Achievers Select Index, providing access to international companies outside the United States with a growing dividend payment. This fund has an expense ratio of 0.20%.

VYMI – Vanguard International High Dividend Yield ETF

Similarly, VYMI is the international version of VYM, providing access to international stocks with a higher than average dividend yield, excluding REITs. The Vanguard International High Dividend Yield ETF seeks to track the FTSE All-World ex US High Dividend Yield Index and has an expense ratio of 0.22%.

Where to Buy These Vanguard Dividend ETFs

M1 Finance is a great choice of broker to buy these ETFs. It has zero transaction fees and offers fractional shares, dynamic rebalancing, and a modern, user-friendly interface and mobile app. I wrote a comprehensive review of M1 Finance here.

Canadians can find the above ETFs on Questrade or Interactive Brokers. Investors outside North America can use Interactive Brokers.

All these ETFs are also part of the dividend portfolio I designed for income investors.

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Disclosures:  None.

Interested in more Lazy Portfolios? See the full list here.

Disclaimer:  While I love diving into investing-related data and playing around with backtests, this is not financial advice, investing advice, or tax advice. The information on this website is for informational, educational, and entertainment purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a research report. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. I always attempt to ensure the accuracy of information presented but that accuracy cannot be guaranteed. Do your own due diligence. I mention M1 Finance a lot around here. M1 does not provide investment advice, and this is not an offer or solicitation of an offer, or advice to buy or sell any security, and you are encouraged to consult your personal investment, legal, and tax advisors. Hypothetical examples used, such as historical backtests, do not reflect any specific investments, are for illustrative purposes only, and should not be considered an offer to buy or sell any products. All investing involves risk, including the risk of losing the money you invest. Past performance does not guarantee future results. Opinions are my own and do not represent those of other parties mentioned. Read my lengthier disclaimer here.