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Higher Returns with Lower Risk: The SectorSurfer Advantage

VIG Vanguard Dividend Appreciation ETF

Category: Large Cap Growth Equities

Inception: 2006-04-21 Issuer: Vanguard
Net Assets
$102.3B
Expense Ratio
0.05 %
# of Holdings
338
Average Daily Volume
1.31M

Fund Overview

The Vanguard Dividend Appreciation ETF (VIG) is designed to track the performance of the NASDAQ US Dividend Achievers Select Index, which consists of U.S. stocks with a history of increasing dividends for at least 10 consecutive years. VIG provides exposure to high-quality companies with strong financials and a commitment to returning capital to shareholders. The fund is passively managed, offering low-cost access to dividend growth stocks, making it an attractive option for income-focused investors seeking long-term capital appreciation. With a diversified portfolio across sectors, VIG aims to reduce volatility while providing steady income growth over time.
Asset Class
Equity
Industry
N/A
Annual Dividend Rate
Smart Beta
Yes
Leveraged / Inverse
N/A / No
Dividend Quality - Yield
 - 1.66 %
Currency Hedged
No
Portfolio Turnover
11 %
Dividend Date

Why Invest in the VIG ETF?

Potential Benefits

  • Exposure to high-quality U.S. companies with a proven track record of dividend growth.
  • Low expense ratio compared to many actively managed dividend ETFs.
  • Diversification across sectors, reducing single-stock risk.
  • Potential for both income generation and long-term capital appreciation.
  • Passive management minimizes turnover and trading costs.

Potential Risks

  • Dividend-paying stocks may underperform during strong bull markets when growth stocks lead.
  • Concentration in certain sectors (e.g., financials, consumer staples) could increase sector-specific risks.
  • Dividend cuts by underlying holdings could impact performance.
  • Interest rate sensitivity: Rising rates may make bonds more attractive relative to dividend stocks.

Performance

1 Week 1 Month 1 Year 3 Years 5 Years YTD 2025 2024 Since Inception
-0.67% -2.35% +10.10% +59.91% +67.57% +7.85% +14.71% +17.22% +604.17%

Performance


Monthly Returns (%)

Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2026 +1.9% +1.6% -5.2% +6.3% +2.6% +1.3% +1.1% +1.2% -3.2% +0.7% - -
2025 +3.3% +0.4% -4.0% -1.5% +3.6% +3.8% +0.7% +2.4% +2.7% +0.6% +2.6% -0.9%
2024 +1.2% +3.4% +2.8% -4.1% +3.3% +1.4% +4.0% +3.3% +1.4% -2.0% +5.4% -3.9%
2023 +2.9% -2.7% +1.8% +2.3% -2.7% +6.5% +2.4% -1.9% -4.3% -1.5% +7.5% +4.1%
2022 -5.3% -2.8% +3.0% -5.1% -0.1% -6.2% +6.8% -3.5% -8.2% +10.0% +6.7% -3.7%
2021 -2.9% +1.6% +6.0% +4.0% +1.8% -0.1% +3.2% +1.7% -5.0% +6.9% -1.4% +6.5%
2020 +0.6% -8.3% -9.6% +9.9% +3.6% +0.1% +5.0% +6.2% -1.0% -2.3% +10.0% +2.5%
2019 +6.3% +4.6% +1.1% +3.7% -4.6% +6.6% +2.2% +0.6% +1.4% 0.0% +2.4% +2.2%
2018 +5.0% -4.0% -1.3% -0.9% +1.8% +0.3% +4.7% +2.8% +1.7% -6.4% +4.1% -8.7%
2017 +1.8% +4.3% -0.1% +1.7% +1.6% +0.3% +0.7% -0.4% +2.4% +2.1% +4.5% +1.4%
< -5% -5% to -2% -2% to 0% 0% 0% to +2% +2% to +5% > +5%

Top Holdings (by weight)

Symbol Company Name Weight
AAPL APPLE INC 4.9 %
AVGO BROADCOM INC 4.8 %
JPM JPMORGAN CHASE & CO 3.9 %
MSFT MICROSOFT CORP 3.4 %
V VISA INC CLASS A 3.1 %
XOM EXXON MOBIL CORP 2.6 %
MA MASTERCARD INC CLASS A 2.5 %
COST COSTCO WHOLESALE CORP 2.4 %
UNH UNITEDHEALTH GROUP INC 2.3 %
WMT WALMART INC 2.2 %
Top 10 holdings shown, out of 338 total holdings.

Related ETFs: VIG vs Peers

ETF Full Name Expense Ratio Net Assets Holdings Asset Class
DGRO iShares Core Dividend Growth ETF 0.08 % $30.4B 409 Equity
NOBL ProShares S&P 500 Dividend Aristocrats ETF 0.35 % $11.8B 70 Equity
SCHD Schwab US Dividend Equity ETF 0.06 % $70.8B 101 Equity
SDY SPDR S&P Dividend ETF 0.35 % $20.1B 151 Equity
VYM Vanguard High Dividend Yield Index ETF 0.06 % $73.3B 530 Equity
Comparison highlights key differences on cost, coverage, and focus within sector ETFs.

Investment Strategy

VIG tracks the NASDAQ US Dividend Achievers Select Index, which includes U.S. companies that have increased dividends for at least 10 consecutive years. The index employs a market-cap weighting methodology, with additional liquidity and size requirements. The fund primarily holds common stocks across various sectors, with financials, industrials, and consumer staples typically representing significant allocations. VIG is reconstituted annually and rebalanced quarterly to maintain index alignment. The passive management approach keeps costs low while providing transparent exposure to dividend growth stocks.

Frequently Asked Questions

Does VIG pay monthly dividends?

No, VIG pays dividends quarterly, like most U.S. equity ETFs. The payments typically occur in March, June, September, and December.

How does VIG select its holdings?

VIG tracks an index of U.S. companies that have increased dividends for at least 10 consecutive years, with additional liquidity and size requirements.

Is VIG suitable for retirement accounts?

Yes, VIG's focus on stable, dividend-growing companies makes it a popular choice for IRA and 401(k) accounts seeking income with growth potential.

What's the difference between VIG and VYM?

VIG focuses on dividend growth (companies increasing payouts), while VYM targets high current yield. VIG's holdings generally have lower yields but stronger dividend growth histories.

Does VIG include international stocks?

No, VIG invests exclusively in U.S.-listed companies that meet its dividend growth criteria.

Industry Overview

The Vanguard Dividend Appreciation ETF (VIG) invests in U.S. companies with a history of consistently growing dividends, reflecting financial stability and strong cash flows. Dividend growth investing is a popular strategy for investors seeking income with potential inflation protection, as rising dividends can help offset purchasing power erosion. The fund's focus on companies with long-term dividend growth trends makes it particularly appealing for conservative investors and those in or nearing retirement. VIG's sector diversification helps mitigate risks associated with economic cycles.

Alternative Comparison

Compared to similar dividend growth ETFs like NOBL and DGRO, VIG offers a slightly broader selection of companies by requiring only 10 years of dividend growth (versus 25+ years for NOBL). While SCHD focuses more on high current yield with dividend growth characteristics, VIG emphasizes consistent dividend growth over time. VIG's expense ratio is competitive with these peers, making it cost-effective for long-term holdings. Unlike some dividend ETFs that include REITs, VIG focuses exclusively on common stocks.

Issuer Overview

Vanguard is one of the world's largest investment management companies, known for its low-cost index funds and ETFs. With a client-owned structure, Vanguard aligns its interests with long-term investors, offering competitively priced products across asset classes. The firm's reputation for stability and investor-focused philosophy makes VIG a trusted choice for dividend growth investors.

Conclusion

VIG represents a compelling option for investors seeking exposure to high-quality U.S. companies with sustainable dividend growth. Its low-cost structure, diversified portfolio, and focus on financially stable businesses make it suitable for both core portfolio holdings and income-focused allocations. While not the highest-yielding dividend ETF, VIG's emphasis on dividend growth potential offers a balance between income generation and long-term capital appreciation prospects.

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