Vanguard Dividend Appreciation ETF

VIG

Market cap $104B

The Vanguard Dividend Appreciation ETF provides a cost-effective way to own top dividend growers. However, other ETFs offer higher yields and total returns.

For most investors, this is a game to stick in for the long haul. That includes novice investors with decades ahead of them before they clock out for the last time and even retirees.

Dividend investing is increasingly vital amid higher rates and inflation, offering passive income and wealth compounding for retirement. Anchoring a portfolio with quality dividend ETFs like SCHD, FDVV, or CGDV can provide reliable income and potential outperformance. Combining high dividend growers (e.g., V, MA, WM) with stable high-yielders (e.g., VZ, O, ADC, STWD) balances growth and income.

Both VIG and VYM ETFs offer ultra-low costs and deep liquidity. VIG has a higher weighting in technology and a lower dividend yield than VYM.

VIG has delivered stronger recent returns and holds a much larger, more diversified portfolio than HDV HDV offers a higher dividend yield and lower volatility, with heavier exposure to defensive and energy sectors VIG costs slightly less to own and trades with high liquidity, but its yield is about half that of HDV These 10 Stocks Could Mint the Next Wave of Millionaires ›

2026 could see a market rotation that finally favors more cyclical and defensive areas of the market. Bonds and dividend stocks are two areas that could benefit from a growth slowdown in the U.S. economy.

The Global X Artificial Intelligence ETF offers excellent exposure to the adoption of generative AI. The Ark Next Generation Internet ETF is an actively managed ETF that focuses on a variety of AI winners.

Last year marked the third straight year of double-digit gains for the S&P 500. A fourth consecutive year is far from guaranteed.

The Schwab Dividend ETF is known for its high yield. The Vanguard ETF has a high return for a dividend ETF.

No matter how much investors hope it will happen, volatility in the stock market isn't going away, and market swings of a few percentage points in a single day, which used to be incredibly rare, may become more common, especially if we are truly in an AI bubble or if there are truly signs that the last three years of double-digit gains point to signs of an impending crash.