ETF Highlight
The Vanguard High Dividend Yield ETF
tracks the FTSE High Dividend Yield Index. The index selects
high-dividend-paying US companies, excluding REITS, and weights them with a
multifactor method. VYM offers excellent exposure in a low-cost wrapper. The
fund’s broad basket stems partly from its comparatively lax dividend screens:
Any company paying an above-average dividend and a great choice for those
looking for cheap, easy-to-trade access that is forecast to pay a dividend
in the next 12 months qualifies, although firms with high yields, thanks to falling
stock prices, get lower weightings. This broad portfolio aligns well with other
benchmarks by firm size and by yield. The similarities extend to sector
breakdowns as well. In all, VYM looks very much like other segment benchmarks.
Investors can access VYM at a very low round-trip cost, making it a great
choice for those looking for cheap, easy-to-trade access. VYM’s expense
ratio is .1% and its yield is 2.74%. The
ETF Portfolio owns a 25% position in this ETF.
Notice that it is struggling to
hold its long term uptrend. If it can’t,
the shares will be Sold.
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