Vanguard International Dividend Appreciation ETF

VIGI

Market cap $8.57B

Not only do ETFs offer a good deal of diversification, but they can also help lower your overall risk compared to investing in an average security.

Designed to provide broad exposure to the Foreign Large Blend ETF category of the market, the Vanguard International Dividend Appreciation ETF (VIGI) is a smart beta exchange traded fund launched on 03/03/2016.

The search for top dividend ETFs is always on, particularly for investors who don't have the time or energy to invest in researching hundreds or thousands of potential options in this universe.

International diversification is gaining traction as foreign equities outperform, but foreign growth ETFs remain underappreciated due to recent underperformance versus value. VIGI, while classified as a growth ETF, leans more toward value/blend through its focus on high-quality, dividend-growing stocks, offering lower volatility and defensive characteristics. EFG provides pure developed market growth exposure with higher volatility and no emerging market allocation, but comes at a higher expense ratio/turnover than VIGI.

Exchange Traded Funds have become a popular investment vehicle for investors, with high dividend ETFs especially appealing due to low costs and index tracking.

For investors looking for meaningful and sustained dividend income today or in retirement, there are plenty of options to choose from.

With the possibility of S&P 500's momentum fading and equity outflows mounting, defensive ETFs like VIG, XLP and VXX draw investor focus.

If done right, dividend investing remains a proven and rewarding strategy. Current valuations for most ETFs, including VIGI, are historically high, increasing risk and lowering expected long-term returns for new investors. VIGI offers broad international diversification but disappoints with a sub-2% yield and a P/E ratio near 26x, making it less attractive for value-focused investors.

VIGI theoretically offers diversification both geographically and sectoral, but returns do not show correlation advantages expected against US equities. Performance is outright poor and forward-looking lens on invested regions doesn't show any material structural changes to expect outperformance going ahead. Drawdowns are not significantly less compared to the upside opportunity loss.

The Vanguard International Dividend Appreciation ETF (VIGI) was launched on 03/03/2016, and is a smart beta exchange traded fund designed to offer broad exposure to the Foreign Large Blend ETF category of the market.