![]() Drawdown-wise, VYM's max drawdown of 24.0% is larger than the S&P 500's 20.0% max drawdown (Figure 5). VYM's 10 Yr Stdev of returns is 12.9% versus 14.0% for the S&P 500 Index. Importantly, VYM's performance has been achieved with relatively lower volatility than the market. The VYM ETF has delivered solid historical performance, with 3/5/10 Yr annual returns of 9.8%, 8.9%, and 11.1%, respectively. It is unclear what additional factors the VYM ETF team ranks securities by.įigure 3 - VYM Top 10 positions () Returns Interestingly, the largest weight of the fund is Johnson & Johnson ( JNJ), despite it not having the highest dividend yield or dividend growth rate of the top 10 positions. The fund's top 10 positions are shown in Figure 3 and account for 23% of the fund. It is also overweight cyclical energy, financials, and industrials and severely underweight technology (Figure 2).įigure 2 - VYM sector breakdown () The defensive skew means the VYM ETF has higher than market weights in consumer staples and utilities. Style-wise, the VYM ETF skew towards large-cap value (Figure 1).įigure 1 - VYM Portfolio composition () The VYM ETF holds a total of 443 stocks in its portfolio, with a median market cap of $132 billion. The index also applies additional proprietary screens, although this is not disclosed. The investment universe excludes REITs and companies currently not paying dividends and forecasted to not pay a dividend in the next 12 months. The VYM ETF seeks to achieve its investment objective by tracking the FTSE High Dividend Yield Index (the "Index"), which measures the investment return of companies that are forecasted to pay high dividend yields. The VYM ETF currently has $58 billion in assets under management ("AUM"). ![]() The Vanguard High Dividend Yield ETF aims to provides a low-cost vehicle for investors to gain exposure to stocks that are forecasted to pay above-average dividend yields. the proprietary screens employed by the VYM. I also feel more comfortable knowing the weighting methodology of SCHD vs. ![]() The VYM ETF is a solid high-yielding fund by itself, but my conclusion is that the SCHD has better historical returns and risk metrics, not to mention a higher distribution yield that has been growing at a faster pace. How does the Vanguard High Dividend Yield ETF ( NYSEARCA: NYSEARCA: VYM ) compare against SCHD? I found that the SCHD ETF has the highest historical returns, as well as the most sensible strategy that balances dividend yield and financial strength. Dividend Equity ETF ( SCHD), the Proshares S&P500 Dividend Aristocrats ETF ( NOBL), and the SPDR Portfolio S&P 500 High Dividend ETF ( SPYD ). Recently, I have written articles reviewing multiple high-yielding exchange-traded funds ("ETFs") such as the Schwab U.S. ![]()
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