Vanguard Dividend Appreciation ETF (NYSEMKT:VIG)

CAPS Rating: 4 out of 5

Closed end fund.


Player Avatar TMFBrich (86.76) Submitted: 8/16/2011 5:19:38 PM : Outperform Start Price: $47.59 VIG Score: -0.98

I think this is a good option for defensive-minded investors. Here's what I wrote about VIG on Aug. 5, 2011:

"I'm going to cheat a little bit and give an exchange-traded fund rather than a stock: Vanguard Dividend Achievers (NYSE: VIG). This low-cost ETF, with an expense ratio of just 0.18%, is suitable for conservative investors. It comprises 127 companies that have increased their regular annual dividend payments for at least 10 consecutive years. The ETF offers exposure to high-quality large-cap names, and allows nervous investors to sleep better. Roughly 61% of the holdings represent traditionally defensive industries: consumer staples, industrials, and energy.

The fund's top 10 holdings, which alone make up 40% of assets, are a who's-who of dividend-paying blue chips: stocks like McDonald's, IBM, and Coca-Cola. At just more than 2%, the ETF's yield isn't overwhelming, but remember: Those payouts should grow over time."

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