Investing in Vanguard High Dividend Yield ETF (AMEX:VYM): What You Need to Know
The Vanguard High Dividend Yield ETF (AMEX:VYM) is a passively managed exchange traded fund designed to provide a broad exposure to US dividend-paying stocks. It is a popular dividend ETF among passive investors, as it tracks the FTSE High Dividend Yield Index, which holds a portfolio of 442 stocks from the US. investors interested in obtaining a high dividend yield from an ETF should consider VYM.
What is VYM and How Does it Work?
VYM is an ETF that tracks the performance of the FTSE High Dividend Yield Index, which is composed of 442 stocks from the US. This ETF has a low expense ratio of 0.08%, and a dividend yield of 2.8%. VYM is a great way for investors to gain exposure to dividend-paying stocks, as it is diversified and relatively low cost.
What Are the Benefits of Investing in VYM?
Investing in VYM has several benefits. Firstly, it is a low-cost way to gain exposure to dividend-paying stocks. Secondly, it is diversified, as it holds 442 stocks from the US. Thirdly, it has a high dividend yield of 2.8%. Finally, it is relatively liquid, as it has a trading volume of roughly 2.06 million shares.
What Are the Risks of Investing in VYM?
As with any investment, there are Risks associated with VYM. Firstly, it is passively managed, and as such, it may not provide the same level of returns as actively managed investment. Secondly, it is heavily concentrated in the US, and as such, is subject to political and economic Risks. Finally, its dividend yield may not be as high as other dividend-paying investment.
What Other Dividend ETFs Are Available?
There are a number of other dividend ETFs available to investors. These include: Vanguard High Dividend Yield Index (VHYAX), WidsomTree US Large Cap Dividend ETF (AMEX:DLN), and iShares Core High Dividend ETF (AMEX:HDV). Each of these ETFs has a different mix of stocks, dividend yields, and expenses, so investors should do their research before Investing.
What Are the Best stocks for Dividend investors?
When it comes to dividend Investing, there are a number of stocks that have high dividend yields and have grown their dividends at a steady rate. These include: Microsoft Corporation (NASDAQ:MSFT), AT&T Inc. (NYSE:T), Apple Inc. (NASDAQ:AAPL), Johnson & Johnson (NYSE:JNJ), Coca-Cola Company (NYSE:KO), and Exxon Mobil Corporation (NYSE:XOM). It is important to note that the dividend yield of these stocks is significantly higher than the dividend yield of VYM, which hovers around 2.8%.
Conclusion
The Vanguard High Dividend Yield ETF (AMEX:VYM) is a great way for investors to gain exposure to dividend-paying stocks in a diversified and low-cost manner. It has a high dividend yield of 2.8% and a trading volume of roughly 2.06 million shares. However, it is important to note that there are other dividend ETFs available, and that the dividend yield of VYM may not be as high as other dividend-paying investment.
