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Vanguard Div Appreciation ETF (ARCA: VIG)

Vanguard Div Appreciation ETF (ARCA:VIG), Trade Ideas

Vanguard Div Appreciation ETF

Vanguard Div Appreciation ETF - DNQ

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Vanguard is a leader in ETFs, known for stability and low costs. Despite its impressive portfolio, it does not offer a Bitcoin ETF.

5 Things You Need To Know About Vanguard ETFs: Why There&#39;s No Bitcoin ETF In Their Lineup?

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Stock trading is fraught with risks, and it exposes traders to situations where they can end up losing all their money -- or end up laughing all the way to the bank.

A Strange Year Prompts the Question: How To Survive A Stock Market Crash?

Vanguard International Dividend Appreciation ETF

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Vanguard has become a towering figure <a href="https://www.benzinga.com/etfs">in the world of exchange-traded funds (ETFs)</a>. 
As investors increasingly turn to ETFs for their diversification, lower costs, and liquidity, understanding the offerings and strategies of major players like Vanguard is essential. 
Yet, amidst this expansive array of financial instruments, one notable absence in Vanguard&#8217;s portfolio raises eyebrows: the lack of a <a href="https://www.benzinga.com/topic/bitcoin-etf">Bitcoin ETF. </a>
Here, we delve into the five critical factors about Vanguard ETFs, also explaining why a Bitcoin ETF is deliberately missing from their portfolio lineup.
<h3 class="wp-block-heading">Vanguard&#8217;s Status In The ETF Arena</h3>
Vanguard ranks as the second-largest ETF issuer globally, overseeing a diverse portfolio of over a hundred ETFs and boasting an impressive $2.5 trillion in assets under management (AUM), just shy of BlackRock Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BLK#NYSE">BLK</a>), which leads with $2.7 trillion AUM.
The Vanguard S&amp;P 500 ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VOO#NYSE">VOO</a>), with $426 billion in AUM as of Mar. 14, 2024, is not only Vanguard&#8217;s flagship fund but also the world&#8217;s second-largest ETF, trailing slightly behind the SPDR S&amp;P 500 ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) at $503 billion. 
Top 7 Vanguard&#8217;s ETFs By AUM
<figure class="wp-block-table is-style-stripes"> 
<table>
<thead>
<tr>
<th>ETF</th>
<th>AUM (bn)</th>
</tr>
</thead>
<tbody>
<tr>
<td>Vanguard S&amp;P 500 ETF </td>
<td>426.87 </td>
</tr>
<tr>
<td>Vanguard Total Stock Market ETF </td>
<td>385.48 </td>
</tr>
<tr>
<td>Vanguard FTSE Developed Markets ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VEA#NYSE">VEA</a>)</td>
<td>130.07 </td>
</tr>
<tr>
<td>Vanguard Growth ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VUG#NYSE">VUG</a>)</td>
<td>119.81 </td>
</tr>
<tr>
<td>Vanguard Value ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTV#NYSE">VTV</a>)</td>
<td>115.14</td>
</tr>
<tr>
<td>Vanguard Total Bond Market ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BND#NYSE">BND</a>)</td>
<td>105.94</td>
</tr>
<tr>
<td>Vanguard Div Appreciation ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VIG#NYSE">VIG</a>) </td>
<td>77.92</td>
</tr>
</tbody>
</table>
</figure>
<h3 class="wp-block-heading">Champion of Low Fees</h3>
In the competitive ETF marketplace, cost efficiency is a significant battleground. Vanguard emerges as a victor here, offering the lowest average expense fees among its funds—an AUM-weighted average expense ratio of a mere 0.05%, according to data from VettaFi. 
<figure class="wp-block-table is-style-stripes"> 
<table>
<tbody>
<tr>
<td>Issuers</td>
<td>Expense Rank</td>
<td>Avg. Expense Ratio (%)</td>
</tr>
<tr>
<td>Vanguard</td>
<td>1</td>
<td>0.05%</td>
</tr>
<tr>
<td>BNY Mellon</td>
<td>2</td>
<td>0.05%</td>
</tr>
<tr>
<td>Charles Schwab</td>
<td>3</td>
<td>0.08%</td>
</tr>
<tr>
<td>Bondbloxx Investment Management Corp.</td>
<td>4</td>
<td>0.10%</td>
</tr>
<tr>
<td>GAMCO Investors, Inc.</td>
<td>5</td>
<td>0.11%</td>
</tr>
<tr>
<td>Humankind USA LLC</td>
<td>6</td>
<td>0.11%</td>
</tr>
<tr>
<td>State Street</td>
<td>7</td>
<td>0.12%</td>
</tr>
<tr>
<td>Deutsche Bank AG</td>
<td>8</td>
<td>0.13%</td>
</tr>
<tr>
<td>Goldman Sachs</td>
<td>9</td>
<td>0.15%</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Data: VettaFi</figcaption></figure>
The cheapest ETFs issued by Vanguard are the Vanguard S&amp;P 500 ETF, Vanguard Total Stock Market ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VTI#NYSE">VTI</a>), and the Vanguard Total Bond Market ETF, all screening an expense ratio of just 0.03%.
<h3 class="wp-block-heading">Leading The 2024 Inflow Race</h3>
In 2024, Vanguard outshines its competitors in attracting investment flows. The issuer has seen a staggering $75 billion in inflows over the past three months, eclipsing BlackRock&#8217;s $55.7 billion, thereby securing its position as the top performer in fund flows thus far this year.
The Vanguard S&amp;P 500 ETF has attracted $21 billion over the past three months, topping the ranking among its peers. 
<figure class="wp-block-table is-style-stripes"> 
<table>
<tbody>
<tr>
<td>Issuers</td>
<td>Fund Flow Rank</td>
<td>3-Month Fund Flow ($MM)</td>
</tr>
<tr>
<td>Vanguard</td>
<td>1</td>
<td>$70,097.57</td>
</tr>
<tr>
<td>BlackRock, Inc.</td>
<td>2</td>
<td>$55,791.59</td>
</tr>
<tr>
<td>Invesco</td>
<td>3</td>
<td>$20,380.07</td>
</tr>
<tr>
<td>State Street</td>
<td>4</td>
<td>$16,097.65</td>
</tr>
<tr>
<td>Dimensional</td>
<td>5</td>
<td>$9,362.99</td>
</tr>
<tr>
<td>JPMorgan Chase</td>
<td>6</td>
<td>$9,263.38</td>
</tr>
<tr>
<td>Fidelity</td>
<td>7</td>
<td>$9,240.89</td>
</tr>
</tbody>
</table>
<figcaption class="wp-element-caption">Data: VettaFi</figcaption></figure>
<h3 class="wp-block-heading">A Conservative Product Range</h3>
Unlike some of its peers, Vanguard has opted for a more conservative route in its ETF offerings. The company does not offer leveraged ETFs, sticking strictly to equity and fixed-income products. 
This strategic choice highlights Vanguard&#8217;s focus on traditional investment vehicles over speculative or alternative assets. Vanguard&#8217;s portfolio notably lacks any commodities, currency, or Bitcoin-related ETFs.
<h3 class="wp-block-heading">Absence of Bitcoin and Crypto ETFs</h3>
This absence isn&#8217;t due to oversight but a deliberate decision. Vanguard has explicitly stated it has no plans to introduce a Bitcoin ETF or any other crypto-related products, distinguishing itself from other major ETF issuers — such as BlackRock, VanEck, Franklin Templeton, WisdomTree, Invesco, Fidelity, Global X, 21 Shares and ProShares – who have embraced the crypto bandwagon.
Why No Bitcoin ETF? Vanguard&#8217;s Reasoning
Vanguard&#8217;s stance on Bitcoin and cryptocurrencies is grounded in a cautious approach to investment merit and client needs. Janel Jackson, global head of ETF Capital Markets and broker &amp; index relations at Vanguard, has expressed skepticism about the role of cryptocurrencies in long-term portfolios. 
Citing crypto&#8217;s speculative nature, lack of inherent economic value, and potential to disrupt portfolio stability, Vanguard sees crypto as an &#8220;immature asset class.&#8221; 
Instead, the company invests its interest in blockchain technology for its potential to enhance capital market efficiency, steering clear of cryptocurrencies as investment products.
Now Read: <a href="https://www.benzinga.com/markets/cryptocurrency/24/03/37712624/tightening-the-tap-regional-banks-tech-stocks-bitcoin-brace-for-liquidity-crunch-as-fed-li">Tightening The Tap: Regional Banks, Tech Stocks, Bitcoin Brace For Liquidity Crunch As Fed Lifeline Ends</a>

5 Things You Need To Know About Vanguard ETFs: Why There's No Bitcoin ETF In Their Lineup?

The SPDR S&amp;P 500 ETF Trust (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>) is off to a shaky start to 2022, down 5.1% year-to-date.
Investors are rightfully concerned about the potential for Federal Reserve interest rate hikes starting as soon as March, but history suggests the Fed&#39;s plan to begin reducing its balance sheet could be even more of a bearish catalyst for stock prices than rising rates.
Balance Sheet Expansion: The Federal Reserve&#39;s <a href="https://www.federalreserve.gov/monetarypolicy/bst_recenttrends.htm">balance sheet</a> roughly doubled in size to an unprecedented $9 trillion during the pandemic thanks to aggressive monthly bond and mortgage-backed security purchases. That buying has contributed to elevated inflation levels and high stock market valuations.
The Fed has hinted it will begin its &quot;quantitative tightening&quot; process in the near future, but the last time the Federal Reserve sold assets, it didn&#39;t go well for stock market investors.
Prior to the financial crisis in late 2008, The Fed held less than $1 trillion in assets on its balance sheet. From Sept. 15, 2008 to Jan. 15, 2015, the Fed increased its balance sheet holdings to $4.51 trillion. During that same stretch, the S&amp;P 500 gained 65.7%.
<img alt="" src="https://www.benzinga.com/files/u81483/fed_assets_and_sp500.png" style="height:366px; width:625px" />
The Fed began its &quot;balance sheet normalization&quot; process in October 2017, allowing bonds <a href="https://money.usnews.com/investing/news/articles/2022-01-24/fed-could-resort-to-outright-asset-sales-to-reduce-balance-sheet-credit-suisse">to mature</a> without reinvesting the repaid principal into new securities. That process continued through Aug. 26, 2019, reducing the Fed&#39;s balance sheet to around $3.76 trillion. During that previous stretch of tightening, the S&amp;P 500 gained just 12.1%.
Related Link: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/22/02/25422060/us-adds-467-000-jobs-in-january-good-for-the-economy-but-not-for-markets">US Adds 467,000 Jobs In January: &#39;Good For The Economy, But Not For Markets&#39;</a>
Sector Performance: Some sectors of the market struggled during the previous tightening period more than others. The Utilities Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlu#NYSE">XLU</a>) more than doubled the S&amp;P 500&#39;s return during the previous tightening period, generating a total return of 30.6%. The Real Estate Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlre#NYSE">XLRE</a>) was also a top performer, generating a total return of 27.9%. On the other end of the spectrum, the Energy Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xle#NYSE">XLE</a>) generated a negative total return of 23.3% during quantitative tightening, while the Materials Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlb#NYSE">XLB</a>) generated a negative total return of 6.3%.
Growth and dividend stocks outperformed during the period. The <a href="https://www.benzinga.com/money/vanguard-review/">Vanguard</a> Growth Index Fund ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vug#NYSE">VUG</a>) generated a total return of 22.7%, while the Vanguard Dividend Appreciation Index Fund ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) produced a 24.2% total return.
Small-cap stocks and value stocks underperformed during the previous balance sheet run-off. The Vanguard Value Index Fund ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vtv#NYSE">VTV</a>) generated just a 9.8% total return, while the Vanguard Small-Cap Index Fund ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vb#NYSE">VB</a>) generated an 8.1% total return.
Benzinga&#39;s Take: The biggest difference between the upcoming Fed tightening cycle and the previous one may happen if the Fed actually sells assets rather than simply letting them mature and run off naturally. Asset sales could drain bank balance sheet liquidity and potentially pressure both the credit market and stock market valuations, according to Credit Suisse.

What The Fed's Balance Sheet Reduction Will Mean For The S&P 500

Stock trading is fraught with risks, and it exposes traders to situations&nbsp;where they can end up losing all their money -- or end up laughing all the way&nbsp;to the bank.
Uncertain Backdrop: The current macroeconomic and geopolitical environment has created a fluid environment. Notwithstanding the uncertainties, the market has continued to grind higher despite the COVID-19 pandemic and sneak&nbsp;into record territory.
The broader S&amp;P 500 Index, which plunged sharply earlier this year amid the onset of the pandemic, has rebounded nicely after hitting a bottom in late-March. Since scaling a peak of 3,588.11 in early September, the broader gauge has gone into&nbsp;consolidation mode, assimilating the strong gains.
With the uncertainty surrounding the U.S. presidential election and the bickering among lawmakers on stimulus to kickstart the sagging economy, stocks began moving southwards in mid-October. This has conjured up visions of an imminent pullback, which could precipitate a crash. While the outcome of the election has lifted markets, rising COVID-19 cases could put a scare into the markets once again.
How should you prepare for a sudden downtown?
Identifying a Crash:&nbsp;A bear market is a pullback in excess of 20% from a recent high. A stock market crash can broadly be defined as a sudden and steep decline in stock prices within a very short interval of time. When stocks begin to fall, the already-weak investor sentiment worsens further. Fear becomes the dominant emotion, taking over from greed, and this leads to incessant selling, wiping away millions in market value from stocks.
History of Stock Market Crashes: Among the biggest recorded stock market crashes in the history of the U.S. are:
The stock market crash of 1929 
The stock market crash of 1987 
The dotcom bubble burst of 1999-2000 
The 2008 crash in the wake of the Great Recession that followed the<a href=" https://www.benzinga.com/news/20/09/14437130/this-day-in-market-history-lehman-brothers-collapses">&nbsp;Lehman Brothers&nbsp;bankruptcy</a>.
Related Link: <a href=" https://www.benzinga.com/trading-ideas/long-ideas/20/02/15418441/3-safe-etfs-if-a-stock-market-correction-comes-calling"> 3 &#39;Safe&#39; ETFs If A Stock Market Correction Comes Calling </a>
For those jittery investors, panicking over potential losses, here are a few guidance points that can help you to stay sane amid the pandemonium.
Allow the Turn of Events to Run Its Course: Having a clear mind is very important in investing. Knee-jerk reactions, which burn a hole in the pocket, should be avoided at any cost. Fear and panic should be kept in check.
It is better to keep in mind the maxim &quot;buy low and sell high.&quot;
Panicking and pressing the sell button at a time when the stock market crashes will only leave an investor poorer, shutting them&nbsp;out of the opportunity of capitalizing on a market rebound.
If we go back in history, stock markets around the globe have survived some serious crashes and have emerged stronger.
The most recent crash amid the Great Recession saw the S&amp;P 500 hitting a low of 666.79 on March 6, 2009. Cut to a little over a decade from there, the index has added more than 400%.
It&#39;s just a matter of waiting out the adversity with ample patience.
Stay Immune to the Noise Around: With the mushrooming of the so-called stock market pundits, who have an opinion at every turn of the stock market, it is quite natural to be swayed by their recommendations and warnings.
At least, in times of crises such as a market crash, it is advisable to shut out of the cacophony. Heeding the advice of every expert only lends to&nbsp;more confusion, making it harder&nbsp;to think rationally.
Instead, stay focused on investment goals and look at a longer time horizon to ride out the volatility.
Turn Adversity Into Opportunity: As the saying goes, an optimist finds opportunity even amid adversity. Be that optimist who still sees the rosier side of dark times. Here are some things an investor can do to capitalize on a market downturn:
Scout for stocks of profitable companies that pay out dividends. Dividends make for a steady stream of income that accrues to an investor. It is paid out of the net income earned by the company. Apart from coming in handy for meeting expenses, dividends can also be used for reinvesting.
One can invest in a fund or ETF investing purely in <a href=" https://www.benzinga.com/trading-ideas/long-ideas/20/03/15697866/7-safe-dividend-plays-for-2020"> dividend-paying stocks </a> such as the Vanguard Dividend Appreciation Index Fund ETF Shares (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) and SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sdy#NYSE">SDY</a>).
Consider bonds. Bonds also fetch fixed income in the form of interest.
Buy recession-proof or defensive stocks such as consumer staples that can withstand the stock market sell-off.
Diversify your risk by investing in a portfolio or an ETF.
Avoiding herd mentality, maintaining one&#39;s sanity in the face of adversity, cutting out noise and devising a prude investment plan for the down time will serve an investor well during times of a stock market crash.
Related Link: <a href=" https://www.benzinga.com/analyst-ratings/analyst-color/20/03/15518424/how-to-play-the-2020-stock-market-crash-like-1987-2000-or-2008"> How To Play The 2020 Stock Market Crash: Like 1987, 2000 Or 2008? </a>

A Strange Year Prompts The Question: How To Survive A Stock Market Crash?

With interest poised to remain low and payout growth likely to expand this year, dividend stocks and the related exchange traded funds could be set to deliver for investors again in 2020.
<h3>What Happened</h3>
Enter the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>), the largest U.S. dividend ETF by assets. At the end of last year, <a href="https://investor.vanguard.com/etf/profile/portfolio/vig">VIG had $42.1 billion</a> in assets under management. Two of the primary reasons for VIG&#39;s popularity are its low fee and its emphasis on dividend growth stocks.
The Vanguard fund charges just 0.06% per year, or $6 on a $10,000 investment, making it one of the least expensive funds its category. Additionally, VIG follows the NASDAQ US Dividend Achievers Select Index, which requires that member firms have dividend increase streaks of at least 10 years.
That combination of low costs and an emphasis on dividend growth helps VIG earn <a href="https://www.cfraresearch.com/">CFRA Research&#39;s</a> focus ETF for February honors.
<h3>Why It&#39;s Important</h3>
&ldquo;Overall, CFRA&rsquo;s equity analysts find the stocks inside VIG to be attractively valued using CFRA STARS. Nine of the top-ten holdings at the end of 2019 were Buy or Strong Buy recommendations, including Abbot Laboratories&nbsp;and Comcast,&rdquo; said CFRA Director of ETF &amp; Mutual Fund Research Todd Rosenbluth in a note out Monday. &ldquo;In addition, the portfolio is deemed to incur low risk considerations based on consistent earnings, as well as dividend, records.&rdquo;
Home to 182 stocks, VIG allocates 26.70% of its weight to the industrial sector while the consumer services and healthcare sectors combine for 32% of the ETF&#39;s roster.
For now, VIG&#39;s tech exposure is just 9.40%, with over half that allocated to Microsoft (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/msft#NASDAQ">MSFT</a>), but the fund&#39;s weight to that sector should increase as more technology stocks meet the 10-year payout hike requirement.
<h3>What&#39;s Next</h3>
&ldquo;VIG also stands out for owning more than a strong collection of holdings. The fund charges a minuscule 0.06% expense ratio and trades over one million shares daily with a tight bid/ask spread,&rdquo; said Rosenbluth. &ldquo;While the fund is designed to be a low volatility strategy, VIG&rsquo;s standard deviation is relatively low compared to its equity category.&rdquo;
CFRA has an Overweight rating on the Vanguard dividend fund. That&#39;s the highest rating the research firm assigns to ETFs in its coverage universe.
Related Links:
<a href="https://www.benzinga.com/trading-ideas/long-ideas/20/02/15233850/a-seductive-software-etf-to-buy-on-the-dip">A Super Software ETF</a>
<a href="https://www.benzinga.com/news/earnings/20/02/15233848/3-sector-etfs-to-play-ahead-of-alphabet-disney-earnings">3 ETFs For Disney, Google Earnings</a>

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Time To Appreciate This Cheap Vanguard Dividend ETF

Plenty of dividend investors know about the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>), the largest domestic dividend exchange traded fund by assets. VIG has a noteworthy international counterpart: the Vanguard International Dividend Appreciation ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vigi#NASDAQ">VIGI</a>).
<h3>What Happened</h3>
VIGI, which is more than three years old, follows the NASDAQ International Dividend Achievers Select Index. Components in the international payout fund must have minimum dividend increase streaks of seven years, less than the 10 years required by the domestically-focused VIG&#39;s underlying index.
VIGI &ldquo;applies additional filters to eliminate stocks that may not be able to sustain their dividend growth,&rdquo; said Morningstar <a href="https://www.morningstar.com/articles/934959/a-growthfocused-dividend-strategy.html">in a recent note</a>. &ldquo;The index weights its holdings by market capitalization to help mitigate turnover and trading costs. It also limits individual stocks to 4% of the portfolio at the annual rebalance to improve diversification.&rdquo;
<h3>Why It&#39;s Important</h3>
VIGI is home to 400 stocks and the fund&#39;s selection universe includes developed and emerging markets equities, making the all-country world ex-U.S. indexes relevant comparisons. Year-to-date, the Vanguard fund is beating the MSCI ACWI ex USA Index by 643 basis points.
VIGI devotes 23.50% of its weight to emerging markets stocks and nearly 48% of its weight to European equities, <a href="https://investor.vanguard.com/etf/profile/portfolio/vigi">according to issuer data</a>. Those allocations, particularly the hefty Europe exposure, give the fund something of a value tilt because developing economies and European stocks trade at significant discounts to U.S. equity benchmarks.
&ldquo;Overseas companies that have a history of increasing their dividend payments are also likely to be those that have been consistently growing profitably,&rdquo; said Morningstar. &ldquo;These stable businesses should be less volatile than the broader market and are likely to hold up better during market downturns.&rdquo;
<h3>What&#39;s Next</h3>
VIGI has potential for long-term investors seeking international exposure, but there are some risks with this fund.
&ldquo;Screening for stocks with seven years of dividend growth is a strict hurdle that provides a big advantage,&rdquo; according to Morningstar. &ldquo;It indirectly targets companies that not only have the capacity to make dividend payments but also a willingness to do so. But this screen does have some downsides. It doesn&rsquo;t consider other metrics, such as debt levels and analyst earnings growth estimates, which may be indicative of a firm&rsquo;s capacity to continue making payments.&rdquo;
Morningstar has a Bronze rating on VIGI.
Related Links:
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<a href="https://www.benzinga.com/trading-ideas/long-ideas/19/07/14024127/a-friend-in-the-fed-for-this-dividend-etf">Fed Help For This Dividend ETF</a>

Emerging Market ETFs

VIGI

A Cost-Effective Idea For International Dividends

Home to $32.8 billion in assets under management at the end of the first quarter, the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) is the largest U.S. dividend exchange traded fund.
VIG has attained that massive following due part to its emphasis on dividend growth stocks. The fund&#39;s underlying index, the NASDAQ US Dividend Achievers Select Index, requires member firms to have boosted payouts for at least 10 consecutive years.
<h3>What Happened</h3>
Over the past three years, VIG is lagging the S&amp;P 500 by 200 basis points, but the dividend fund has been less volatile than broader domestic equity benchmarks over that period. While dividend strategies will lag the broad market from time-to-time, VIG&#39;s focus on steady payout growth comes with plenty of advantages for income investors.
&ldquo;This strategy focuses on dividend growth rather than dividend yield,&rdquo; said Morningstar <a href="https://www.morningstar.com/articles/926589/a-dividendgrowth-fund-to-ride-out-market-downturns.html">in a recent note</a>. &ldquo;This approach reduces the fund&#39;s exposure to firms with weak fundamentals that may not be able to sustain their dividend payments, which is a risk that often accompanies a narrow focus on yield.&rdquo;
<h3>Why It&#39;s Important</h3>
VIG is home to 185 stocks with a median market capitalization <a href="https://investor.vanguard.com/etf/profile/portfolio/vig">of $87.7 billion</a>, accentuating the fund&#39;s status as large/mega-cap fund. With the 10-year dividend increase streak requirement, VIG is lightly allocated to some sectors that are traditionally viewed as high-yield destinations, sectors that have only recently started boosting dividends and groups that have recently negative dividend action -- think banks during the financial crisis or energy companies during the 2015 oil bear market.
Industrial and consumer staples stocks combine for 47.6 percent of VIG&#39;s weight while the financial services and health care sectors combine for 23.6 percent. VIG&#39;s top 10 holdings combine for 34.1 percent of the fund&#39;s weight. Six of those stocks, including the top five, are members of the Dow Jones Industrial Average.
&ldquo;As of this writing, the strategy&#39;s dividend yield of 2 percentage points annually matches the dividend yield of the Russell 1000 Index,&rdquo; according to Morningstar. &ldquo;But the strategy&#39;s tilt toward more-stable stocks has helped it shine during market downturns. Its drawdown during the bear market from October 2007 through March 2009 measured 9 percentage points less than the Russell 1000 Index&#39;s drawdown.&rdquo;
<h3>What&#39;s Next</h3>
To be precise, VIG yields 1.96 percent, which is close to the dividend yields on the S&amp;P 500 and the Russell 1000 Index. Focusing on dividend growth over yield, however, can lead to a portfolio with companies sporting better balance sheets than high yielders and, as VIG proves, less volatility.
Morningstar has a Gold rating on VIG.
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A Golden Dividend ETF

With the government shutdown now in its fourth week&nbsp;and 800,000 federal workers on furlough, the risk of recession has increased significantly. The shutdown occurred due to lack of progress in passing a spending bill, wherein Trump demanded funding for $5.7&nbsp;billion for a border wall that is being opposed by the Democrats.
With the average pay loss being $5,000 for 800,000 federal employees, the shutdown has begun to harm the economy through&nbsp;lower consumer spending and investment. Additionally, tax refunds and mortgage applications have been delayed, hampering the housing sector. Public companies are struggling to get approval to raise capital, the Women, Infants, and Children nutrition program went unfunded, and the Food and Drug Administration delayed approval of drugs and medical devices.
The Trump administration&#39;s revised estimates have&nbsp;doubled the cost of the government shutdown. It now projects the closure will subtract 0.1 percentage point from growth every week compared with the previous projection of 0.1 percentage point reduction every two weeks. Jamie Dimon, the CEO of J.P. Morgan Chase believes that the partial shutdown could wipe out growth from the world&#39;s biggest economy if it continues through the first quarter of the year.
<iframe allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" frameborder="0" height="315" src="https://www.youtube.com/embed/kKQvfzDnofY?rel=0" width="560"></iframe>
Apart from the shutdown, U.S.-China trade tensions and global growth worries added to fears of recession. Additionally, growth in the world&#39;s biggest economy has started to slow down as gauges of manufacturing and consumer sentiment have fallen in the recent weeks.
Deutsche Bank warned&nbsp;that the combination of the U.S.-China trade war and government shutdown may result in recession as soon as this year. According to a <a href="https://www.wsj.com/articles/ceos-say-recession-is-top-worry-for-2019-11547672460">new survey</a> of chief executives from the Conference Board, the possibility of a global recession ranks as the top concern on the minds of corporate leaders as they head into 2019. Analysts surveyed by Bloomberg put the risk of a U.S. recession at the highest in more than six years. They see a 25 percent&nbsp;chance of a slump in the next 12 months, up from 20 percent&nbsp;in the December survey.
In such a backdrop, investors should stash their cash in some conventionally secure and recession proof corners of the broad market. Below, we have highlighted a few ETFs from these areas:
SPDR Gold Trust ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/gld#NYSE">GLD</a>)
In difficult market environments, gold is considered a great store of value and hedge against market turmoil. With AUM of $33.2 billion, the ultra-popular GLD tracks the price of gold bullion measured in U.S. dollars, and kept in London under the custody of HSBC Bank USA. It charges 40 bps in fees per year from investors and trades in heavy volume of nearly 8 million shares a day. The fund has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.
iShares 20+ Year Treasury Bond ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tlt#NASDAQ">TLT</a>)
Though the fund was out of investors&#39; favor due to rising yields last year and has an unfavorable Zacks ETF Rank #5 (Strong Sell) with a High risk outlook, the recession risk has brought back some lure. This is because the products tracking the long end of the yield curve often provide a safe haven. TLT provides exposure to long-term Treasury bonds by tracking the ICE U.S. Treasury 20+ Year Bond Index. It is one of the most popular and liquid ETFs in the bond space with AUM of $9.3 billion and average daily volume of 8.9 million shares. Expense ratio comes in at 0.15 percent.
Utilities Select Sector SPDR (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlu#NYSE">XLU</a>)
Being the low-beta sector, utility is relatively protected from large swings (ups and downs) in the stock market and is thus considered a defensive investment or safe haven amid economic or political turmoil. While there are several options in the space, the ultra-popular XLU seems a good bet. With AUM of $8.4 billion, it provides exposure to a small basket of 29 securities by tracking the Utilities Select Sector Index. The product charges 13 bps in annual fees and sees heavy volume of around 19 million shares on average. XLU has a Zacks ETF Rank #3 with a Medium risk outlook.
iShares U.S. Healthcare Providers ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/ihf#NYSE">IHF</a>)
Healthcare generally outperforms during periods of low growth and high uncertainty. The demand for healthcare services remains intact even in the deteriorating economic fundamentals. IHF follows the Dow Jones U.S. Select Healthcare Providers Index with exposure to companies that provide health insurance, diagnostics and specialized treatment. In total, the fund holds 45 securities in its basket and has amassed $863.6 million in its asset base. Volume is good at about 116,000 shares per day on average. The product charges 43 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
Consumer Staples Select Sector SPDR Fund (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/xlp#NYSE">XLP</a>)
The consumer staples sector is also viewed as defensive as it includes a variety of items like food &amp; beverages, non-durable household goods, hypermarkets and consumer supercenters that are essential for daily needs. These products see steady demand even during an economic downturn due to their low level of correlation with economic cycles. This is the most-popular consumer staples ETF with AUM of $9.6 billion and follows the Consumer Staples Select Sector Index. It holds about 33 securities in its basket and charges 13 bps in fees per year from investors. The fund trades in heavy volume of nearly 18.2 million shares a day and has a Zacks ETF Rank #3 with a Medium risk outlook.
Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>)
Dividend paying securities are the major source of consistent income for investors to create wealth when returns from the equity market are at risk. Dividend-focused products offer safety in the form of payouts while at the same time providing stability as mature companies are less volatile to large swings in stock prices. VIG is the largest and most popular ETF in the dividend space with AUM of $30 billion and average&nbsp;daily volume of about 1.1 million shares.&nbsp;It holds 182 securities in the basket and charges 8 bps in annual fees. The product has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook.
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iShares Dow Jones US Health Care Provides Index Fund

iShares Trust Barclays 20+ Year Treasury Bond Fund

Prolonged Shutdown Raises Recession Risk: ETFs To Consider

The S&amp;P 500 closed lower on an annual basis in 2018, weighing on dividend exchange traded funds in the process, but it was still a good year for dividend growth.
S&amp;P 500 dividends hit a record $14.19 per share on a quarterly basis, or $119.80 billion. The SPDR S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/spy#NYSE">SPY</a>), the world&#39;s largest ETF, has a trailing <a href="https://us.spdrs.com/en/etf/spdr-sp-500-etf-SPY">12-month dividend yield </a>of 2.04 percent.
<h3>What Happened</h3>
With the Federal Reserve having raised interest rates four times in 2018, it&#39;s unsurprising that some dividend stocks and ETFs struggled. The upside to that scenario is that some companies may have been compelled to boost dividends to compete with the higher yields offered by less risky U.S. government debt.
The &ldquo;average Q4 2018 dividend increase in the S&amp;P 500 was 10.24 percent, down from 10.41 percent&nbsp;during Q4 2017; 2018 average is 13.48 percent, up from 2017&rsquo;s 11.36 percent,&rdquo; <a href="http://www.indexologyblog.com/">according to S&amp;P Dow Jones Indices</a>.
Last year, the aggregate dividend increase was slightly off 2017&#39;s level, but so were dividend cuts.
&ldquo;For Q4 2018, aggregate increases amounted to $11.9 billion, down from Q4 2017&rsquo;s $12.4 billion,&rdquo; said S&amp;P Dow Jones. &ldquo;Aggregate dividend cuts decreased to $4.5 billion from $7.9 billion for Q4 2017.&rdquo;
<h3>Why It&#39;s Important</h3>
Amid 2018&#39;s backdrop of rising interest rates, dividend growth ETFs fared less poorly than their high dividend counterparts. The Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) and the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sdy#NYSE">SDY</a>) posted an average loss of 2.4&nbsp;percent last year.
VIG requires member firms to have dividend increase streaks of at least a decade, while SDY components must have dividend increase streaks of <a href="https://us.spdrs.com/en/etf/spdr-sp-dividend-etf-SDY">at least 20 years</a>.
Conversely, the Vanguard High Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vym#NYSE">VYM</a>) and the iShares Select Dividend ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/dvy#NASDAQ">DVY</a>) &mdash; both high dividend strategies &mdash; posted an average annual decline of about 6 percent last year.
High dividend ETFs could find some support this year if the Federal Reserve slows its pace of rate hikes or if investors embrace defensive sectors&nbsp;such as consumer staples and utilities. Utilities stocks account for nearly a third of DVY&#39;s weight.
<h3>What&#39;s Next</h3>
The stage is set for more dividend growth in 2019.
&ldquo;Based on their current payout policies, S&amp;P 500 2019 dividends already have a 3.5-percent&nbsp;tailwind built in, setting the stage for potentially another record year, with the increase again expected to outpace wage growth and inflation,&rdquo; said Howard Silverblatt, senior index analyst at S&amp;P Dow Jones Indices.
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iShares Dow Jones Select Dividend Index Fund

Dividends Eclipsed More Records In 2018 Even As ETFs Fell

Volatility and uncertainty surrounding global economic growth and rising yields have made investors defensive. This has increased the appeal for products that provide safety and stability in a rocky market.
Dividend-focused products offer both safety in the form of payouts and stability in the form of mature companies that are less volatile to the large swings in stock prices. The dividend-paying securities are the major sources of consistent income for investors when returns from equity markets are at risk. Further, these products are proven outperformers over the long-term.
While there are plenty of options in the dividend ETF world, honing in on the &quot;dividend aristocrats&quot;&nbsp;could be the most beneficial way to ride out the current market volatility, resulting from political and geopolitical worries.<iframe allow="autoplay; encrypted-media" frameborder="0" height="315" src="https://www.youtube.com/embed/GpC1-r4xYsQ?rel=0" width="560"></iframe>
<h3>Why Dividend Aristocrats?</h3>
Dividend aristocrats are&nbsp;blue-chip dividend-paying companies, which have a long history of raising dividend payments each year. These generally act as a hedge against economic uncertainty and provide downside protection by offering outsized payouts or sizable yields on a regular basis. Additionally, aristocrats tend to skew the portfolio to less volatile sectors and mature companies.
Investors should note that the dividend aristocrat funds offer more dividend growth opportunities when compared to the other products in the space but might not necessarily have the highest yields. Further, these products lead to a healthy portfolio with a greater scope of capital appreciation as opposed to simple dividend paying stocks or those with high yields.
As a result, these products provide a nice combination of annual dividend growth and capital appreciation opportunity and are mainly suitable for risk adverse long-term investors. For them, we have highlighted some popular ETFs that could be excellent choices:
Vanguard Dividend Appreciation ETF&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/vig#NASDAQ">VIG</a>)
This is the largest and most-popular ETF in the dividend space with AUM of $28.9 billion and average daily volume of about 596,000 shares. The fund follows the NASDAQ US Dividend Achievers Select Index, which is composed of high quality stocks that have a record of raising dividend every year. It holds 182 securities in the basket, with none accounting for more than 4.5% share. The fund charges 8 bps in annual fees.
iShares Select Dividend ETF&nbsp;(NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/dvy#NASDAQ">DVY</a>)
This fund provides exposure to the companies with a consistent 5-year history of dividend payments. It follows the Dow Jones U.S. Select Dividend Index and holds 98 securities in its basket with each accounting for less than 2.6% of assets. The ETF has AUM of $16.7 billion and average daily volume of more than 489,000 shares. It charges 39 bps in fees per year from investors.
SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sdy#NYSE">SDY</a>)&nbsp;
With AUM of $15.4 billion and average daily volume of 377,000 shares, this fund provides a well-diversified exposure to 111 U.S. stocks that have been consistently increasing their dividends every year for at least 20 years. This can be done by tracking the S&amp;P High Yield Dividend Aristocrats Index. Each firm accounts for less than 2.5% of assets. The fund charges 35 bps in fees.
Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/schd#NYSE">SCHD</a>)
With AUM of $7.8 billion, this product offers exposure to 108 high-dividend yielding U.S. companies that have a record of consistent dividend payments supported by fundamental strength based on financial ratios and ample liquidity. This can be easily done by tracking the Dow Jones U.S. Dividend 100 Index. The fund is well spread across components, with none holding more than 4.8% of assets. It charges 7 bps in annual fees and trades in solid volume of around 758,000 shares a day.
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SCHD

An Investors' Guide To Dividend Aristocrat ETFs

S&amp;P 500 member firms delivered some solid dividend growth numbers in the first half of 2018.
&ldquo;Aided by strong earnings and corporate management&#39;s confidence in the future, more than 40 percent of the S&amp;P 500 constituents raised their dividends in the first half of 2018,&rdquo; said <a href="https://newpublic.cfraresearch.com/">CFRA Research</a> Director of ETF &amp; Mutual Fund Todd Rosenbluth in a note out Wednesday. &ldquo;Dividend hikes occurred in various sectors, highlighting the benefits of using diversified funds to gain equity income exposure.&rdquo;
<h3>What To Know</h3>
With the Federal Reserve boosting interest rates twice in the first half of the year, some dividend exchange traded funds struggled relative to the broader market. The Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) and the SPDR S&amp;P Dividend ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/sdy#NYSE">SDY</a>) are up 2.3 percent and 1 percent, respectively, year-to-date.
VIG and SDY are two of the largest U.S. dividend ETFs and both focus on dividend growth. SDY follows the High Yield Dividend Aristocrats Index, which requires member firms to have minimum dividend increase streaks of at least 20 years. VIG&#39;s underlying index has a minimum dividend hike streak requirement of a decade.
<h3>Why It&#39;s Important</h3>
&ldquo;According to Howard Silverblatt, Senior Index Analyst of S&amp;P Dow Jones Indices, there have been 216 dividend increases by S&amp;P 500 companies, with 84 occurring in the second quarter,&rdquo; said Rosenbluth. &ldquo;The average second quarter increase was 14 percent, up from 12 percent a year earlier, indicating greater optimism.&rdquo;
More than 400 members of the S&amp;P 500 pay dividends. As of July 10, the S&amp;P 500 <a href="https://us.spdrs.com/en/etf/spdr-sp-500-etf-SPY">yielded 1.90 percent</a>, a level surpassed by some sectors and lagged by others. Health care is an example of a sector that yields less than the S&amp;P 500 (1.8&nbsp;percent), but is also home to robust dividend growth.
SDY devotes 5.81 percent of its weight to health care stocks while that sector represents 12.1&nbsp;percent of VIG making it the Vanguard fund&#39;s third-largest sector allocation.
<h3>What&#39;s Next</h3>
With U.S. companies sitting on mountains of repatriated cash following last year&#39;s tax reform legislation, buybacks and dividends are proving to be among the strategies for deploying some of that cash.
More interest rate hikes could weigh on dividend ETFs, but VIG is lightly allocated to rate-sensitive sectors as utilities and telecommunications names combine for just 3.2&nbsp;percent of the fund&#39;s weight.
CFRA has Overweight ratings on both SDY and VIG.
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Dividend Growth Provides A Spark For These ETFs

E*TRADE Financial Corp. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/etfc#NASDAQ">ETFC</a>) said Wednesday it added 46 exchange traded funds to commission-free platform.
With the latest additions, E*TRADE now offers more than 250 ETFs on a commission-free basis. The 46 newly added funds come from six issuers: Direxion, iShares, Janus Henderson, NuShares, Reality Shares and Vanguard.
<h3>What Happened</h3>
With more and more advisers and investors embracing ETFs, <a href="https://www.benzinga.com/investing/best-brokers-for-etfs/">brokerage firms</a> are getting on the act, offering significant amounts of ETFs without commissions. E*Trade and rivals such as Fidelity and Charles Schwab Corp. (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/schw#NASDAQ">SCHW</a>) have been expanding their commission-free ETF plans to attract new clients.
Earlier this year, Firstrade Securities Inc. said it would offer <a href="https://www.benzinga.com/pressreleases/18/04/r11488349/firstrade-offers-largest-commission-free-etf-program-with-more-than-70">more than 700 ETFs </a>on a commission-free basis, by far the largest such platform in the domestic brokerage business.
<h3>Why It&#39;s Important</h3>
&ldquo;These additions can fill a tactical void for a multitude of strategies&mdash;from tracking broad indexes to seeking higher returns to defending against changing market conditions to pursuing factor-based sector exposure&mdash;while providing commission-free access to some of the most active, well-known ETFs available today,&rdquo; said E*TRADE Vice President Rich Messina <a href="https://www.businesswire.com/news/home/20180620005607/en/E*TRADE-Adds-Today's-Popular-ETFs-Commission-Free-ETF">in a statement.</a>
Among the 46 additions to the E*TRADE commission-free suite are 32 Vanguard funds, including the Vanguard S&amp;P 500 ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/voo#NYSE">VOO</a>), the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vig#NYSE">VIG</a>) and 10 of the issuer&#39;s popular sector ETFs.
<h3>What&#39;s Next</h3>
Three iShares funds were also added to the E*TRADE platform. iShares and Vanguard are the two largest U.S. ETF sponsors.
Other well-known products now available with no commissions on E*TRADE include the Direxion Nasdaq-100 Equal Weighted Index Shares (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/qqqe#NYSE">QQQE</a>), Reality Shares Nasdaq NexGen Economy ETF (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/blcn#NASDAQ">BLCN</a>) and the Vanguard FTSE Developed Markets ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/vea#NYSE">VEA</a>).
Disclosure: The author owns shares of VEA.
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Sector ETFs

BLCN

ETFC

QQQE

SCHW

E*TRADE Adds Almost 50 ETFs To Commission-Free Plan

With Treasury yields rising, some dividend strategies are being pressured. Bond-like sectors &mdash; such as real estate, telecommunications and utilities &mdash; are lagging broader equity benchmarks this year.
That does not mean investors should abandon dividend stocks and exchange traded funds altogether. Some dividend funds can weather the storm of rising interest rates. While it is not setting the world on fire, the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), is up 1 percent this year.
<h3>
	What Happened</h3>
VIG follows the NASDAQ US Dividend Achievers Select Index, which requires that member firms have dividend increases spanning at least 10 years. The Vanguard fund had over $27 billion in assets under management at the end of April, making it the largest dividend ETF trading in the U.S.
VIG has long been a favorite with dividend investors due in part to its low fee. The fund&#39;s annual expense ratio is just 0.08 percent, or $8 on a $10,000 investment, making it less expensive than 92 percent of rival strategies, <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0920&amp;FundIntExt=INT&amp;funds_disable_redirect=true">according to Vanguard data</a>.
&ldquo;Focusing on dividend growth reduces the fund&#39;s exposure to firms that have weak fundamentals and may not be able to sustain their dividend payments, which is a risk that often accompanies a narrow focus on yield,&rdquo; Morningstar said&nbsp;<a href="http://www.morningstar.com/articles/866824/this-highquality-dividendgrowth-fund-can-serve-as-.html">in a Wednesday note</a>.
<h3>
	Why It&#39;s Important</h3>
VIG is a large-cap strategy, as highlighted by the median market value of $65.9 billion for the ETF&#39;s 182 holdings. What&#39;s notable is VIG&#39;s lack of exposure to high-yield sectors. The fund features no real estate exposure, and the telecommunications and utilities sectors combine for just over 3 percent of VIG&#39;s roster.
&ldquo;This portfolio favors profitable companies with durable competitive advantages,&rdquo; according to Morningstar. &ldquo;Because it doesn&#39;t pursue the highest-yielding names, its dividend yield lands near the Russell 1000 Index&#39;s. But it has been able to avoid some firms that have cut their dividend payments.&rdquo;
<h3>
	What&#39;s Next</h3>
VIG has the potential to remain durable even as the Federal Reserve continues its tightening cycle. The fund&#39;s sector-level positioning tilts toward cyclical groups, with industrial and consumer discretionary names combining for over half of its weight.
VIG&#39;s &ldquo;tilt toward profitable names is evident in its portfolio composition,&quot; according to Morningstar. &quot;As of this writing, the fund&#39;s return on invested capital measured 14.3 percent compared with an average measure of 9.9 percent for the Morningstar Category.&quot;&nbsp;
The research firm has a Gold rating on VIG.
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News

A Vanguard Dividend ETF To Lean On

With just a day away to the month of May, investors have turned cautious given that seasonality will play a huge role in pushing stocks down for the next six months, as per the old adage &quot;Sell in May and Go Away.&quot; According to this investment saying, the stock market has a long history of weak performance during the summer months (May to October).
	Will May 2018 Pen the Same Story?
	After a blockbuster start, the U.S. stock market was hit by a series of hurdles including inflationary pressures, a faster-than-expected rates hike, political instability in Washington, geopolitical tension, technology sector turmoil and rising yields.
	Additionally, the signal from European Central Bank to end the cheap money era policy anytime soon and the latest round of domestic economic data added to the weakness.
	This is especially true as America&#39;s economic growth slowed to start the year with 2.3% in the first quarter compared with 2.9% in fourth-quarter 2017 driven by weak consumer spending in nearly five years. Domestic demand rose 1.7% -- the slowest in two years -- after rising at a brisk 4.8% pace in the final three months of 2017.
	However, tightening labor market conditions, lower tax rates, strong earnings expectations and increased government spending are expected to spur economic growth in the coming months, thereby resulting in a bullish condition for the stock market. In particular, the massive $1.5-trillion tax cut will create an economic surge, boosting job growth in manufacturing and other sectors, increasing inflation and interest rates. Additionally, it would lead to higher earnings, increased buyback activities and fat dividends.
	Against such a backdrop, it might be foolish to quit the stock market altogether. Instead, investors could follow some ideas that could lead to a winning portfolio during this soft six-month period.
	Focus on Low Volatility ETFs
	As weak historical trends and volatility are expected to play foul in the stock market, low volatility ETFs appear sensible choices. This is because these have the potential to outpace the broader market in bearish-to-neutral market conditions, providing significant protection to the portfolio. These funds include more stable stocks that have experienced the least price movement in their portfolio. Further, these allocate more to defensive sectors that usually have a higher distribution yield than the broader markets.
	While there are several options in the space, the two most popular ones are PowerShares S&amp;P 500 Low Volatility Portfolio&nbsp;(NYSE: <a class="ticker" href="/stock/splv#NYSE">SPLV</a>) and iShares Edge MSCI Min Vol USA ETF&nbsp;(BATS:USMV).
	Emphasis on Value ETFs
	Value stocks have proven to be outperformers over the long term and are less susceptible to trending markets. These stocks have strong fundamentals &mdash; earnings, dividends, book value and cash flow &mdash; that trade below their intrinsic value and are undervalued. These have the potential to deliver higher returns and exhibit lower volatility compared with their growth and blend counterparts.
	Some of the Zacks ETF Rank #2 ETFs are Vanguard Value ETF&nbsp;(NYSE: <a class="ticker" href="/stock/vtv#NYSE">VTV</a>), Schwab U.S. Large-Cap Value ETF&nbsp;(NYSE: <a class="ticker" href="/stock/schv#NYSE">SCHV</a>), Vanguard Mega Cap Value ETF&nbsp;(NYSE: <a class="ticker" href="/stock/mgv#NYSE">MGV</a>) and PowerShares Dynamic Large Cap Value Portfolio&nbsp;(NYSE: <a class="ticker" href="/stock/pwv#NYSE">PWV</a>).
	Overweight Dividend ETFs
	The dividend-paying securities are the major sources of consistent income for investors when returns from the equity market are at risk. This is especially true as these stocks offer the best of both these world&#39;s &mdash; safety in the form of payouts and stability in the form of mature companies that are less volatile to the large swings in stock prices. The companies that pay dividends generally act as a hedge against economic uncertainty and provide downside protection by offering outsized payouts or sizable yields on a regular basis.
	While the dividend space has been crowded, ETFs with stocks having a strong history of dividend growth seem to be good picks. Vanguard Dividend Appreciation ETF&nbsp;(NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>) and ProShares S&amp;P 500 Aristocrats ETF&nbsp;(BATS:NOBL) have a Zacks ETF Rank #2.
	Invest in Defensive ETFs
	Investors could try out safer avenues and rotate into defensive sectors, like utilities, healthcare, and consumer staples, which generally outperform during periods of low growth and high uncertainty. Additionally, this is a much better option than holding cash. Guggenheim Defensive Equity ETF&nbsp;(NYSE: <a class="ticker" href="/stock/def#NYSE">DEF</a>)&nbsp;could be an excellent choice. This fund offers equal-weight exposure to all the stocks in the index, resulting in a more balanced and diversified portfolio. It helps the portfolio to better weather periods of volatility, while remaining positioned to take advantage of market upswings.
	The other popular ETFs include Consumer Staples Select Sector SPDR Fund&nbsp;(NYSE: <a class="ticker" href="/stock/xlp#NYSE">XLP</a>), Vanguard Consumer Staples ETF&nbsp;(NYSE: <a class="ticker" href="/stock/vdc#NYSE">VDC</a>), SPDR Health Care Select Sector SPDR Fund&nbsp;(NYSE: <a class="ticker" href="/stock/xlv#NYSE">XLV</a>), Vanguard Health Care ETF&nbsp;(NYSE: <a class="ticker" href="/stock/vht#NYSE">VHT</a>) and iShares Dow Jones U.S. Healthcare Sector Index Fund&nbsp;(NYSE: <a class="ticker" href="/stock/iyh#NYSE">IYH</a>).

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Futures

iShares Trust Dow Jones US Healthcare Sector Index Fund

NOBL

PowerShares Exchange Traded Fund Trust Dynamic Large Cap Value Portfolio

SCHV

PowerShares S&P 500 Low Volatility Portfolio

SPLV

USMV

Don't Sell In May And Go Away: Follow These ETF Strategies

The Federal Open Market Committee meets this week, and many bond market participants expect the Fed to raise interest rates after having done so three times in 2017.
Expectations of higher borrowing costs have previously been seen as detrimental to dividend stocks and exchange traded funds, but that tide could be turning if last week&#39;s ETF inflows paint an accurate picture. Each of the top 10 asset-gathering ETFs for the trading week ended March 16 were equity funds, and three of those products were dividend funds.
The iShares Select Dividend ETF (NASDAQ: <a class="ticker" href="/stock/dvy#NASDAQ">DVY</a>) added $3.54 billion in new assets last week, good for the second-best total among all U.S.-listed ETFs.
<h3>
	The DVY Surprise</h3>
Against the backdrop of rising interest rates, it is perhaps surprising that DVY would be the top asset gatherer among dividend ETFs. With last week&#39;s haul, DVY has added $2.97 billion in new assets this year, tops among all dividend ETFs and good for the sixth-best total among all ETFs.
DVY, which tracks the Dow Jones U.S. Select Dividend Index, holds 97 stocks, <a href="https://www.ishares.com/us/products/239500/?referrer=tickerSearch">over 26 percent </a>of which hail from the rate-sensitive utilities sector. As the Fed boosted borrowing costs three times last year, DVY trailed the S&amp;P 500 and suffered outflows of $848.5 million.
While DVY allocates almost 15 percent of its weight to financial services stocks, a sector believed to benefit from higher interest rates, it&#39;s not nearly enough to offset its utilities exposure. The utilities sector is already reflecting the specter of multiple interest rate increases this year as the Utilities Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlu#NYSE">XLU</a>), the largest ETF tracking the sector, is down 4.5 percent year-to-date.
<h3>
	Other Prolific Asset Gatherers</h3>
Last week, the Schwab U.S. Dividend Equity ETF (NYSE: <a class="ticker" href="/stock/schd#NYSE">SCHD</a>) and the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>) also packed on the assets. Investors added $2.33 billion to SCHD and $1.89 billion to VIG. That sent SCHD&#39;s year-to-date inflows to $2.72 billion, putting it just behind DVY on the list of 2018&#39;s top 10 asset-gathering ETFs.
Neither SCHD nor VIG feature large utilities weights. For example, VIG, the largest U.S. dividend ETF by assets, has utilities exposure <a href="https://personal.vanguard.com/us/funds/snapshot?FundId=0920&amp;FundIntExt=INT&amp;funds_disable_redirect=true#tab=2">of just 1.5 percent</a> compared with its largest sector exposure of 34 percent to industrials.
SCHD devotes just 5.3 percent to utilities stocks, making that the ETF&#39;s third-smallest sector weight. The ETF&#39;s largest sector allocation is 20.5 percent to financial services.
Related Links:
<a href="https://www.benzinga.com/trading-ideas/long-ideas/18/03/11371538/the-temptation-of-technology-etfs">Tempting Tech ETFs</a>
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Investors Renew Affinity For Dividend ETFs

With the growth and momentum factors soaring this year, it is not surprising that some dividend-oriented strategies are lagging or barely keeping pace with the S&amp;P 500. That does not mean investors should throw in the towel on dividend stocks and chase sexier fare, such as the FANG quartet.
One dividend ETF that is outperforming the S&amp;P 500 and has recently been notching a series of record highs is the WisdomTree U.S. Quality Dividend Growth Fund (NASDAQ: <a class="ticker" href="/stock/dgrw#NASDAQ">DGRW</a>). DGRW follows the fundamentally-weighted WisdomTree U.S. Quality Dividend Growth Index. That benchmark marries the <a href="https://www.wisdomtree.com/etfs/equity/dgrw">growth and quality factors</a> by evaluating long-term earnings growth trends along with return on assets and return on equity.&nbsp;
&ldquo;While most dividend ETFs covered by CFRA are trailing the 11.7 percent year to date return for the S&amp;P 500 index, CFRA&#39;s Overweight ranked WisdomTree US Quality Dividend Growth Fund is a bright spot rising 13.3 percent over the same time horizon,&rdquo; said <a href="https://newpublic.cfraresearch.com/">CFRA Research</a> Director of ETF &amp; Mutual Fund Research Todd Rosenbluth in a note out Monday. &ldquo;Relative to other dividend-growth ETFs, some of which we will highlight below, DGRW contains more exposure to technology (20 percent) and consumer discretionary (17 percent) assets in the portfolio through May.&rdquo;
<h3>It&#39;s What&#39;s Inside That Matters</h3>
To be precise, technology is DGRW&#39;s largest sector weight while consumer discretionary places fourth. With a combined allocation of over 37 percent to those two sectors, DGRW almost looks like a growth ETF. And it is, but it is a source of dividend growth. The healthcare and industrial sectors combine for almost 39 percent of DGRW&#39;s roster.
&ldquo;While DGRW has performed well this year, it&#39;s what&#39;s inside the fund that CFRA likes,&rdquo; said Rosenbluth. &ldquo;CFRA Strong Buy recommended Apple Inc.&lt; (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>), Buy recommended Home Depot Inc. (NYSE: <a class="ticker" href="/stock/hd#NYSE">HD</a>) and Buy recommended McDonald&#39;s Corporation (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>) are among the top holdings in these sectors.&rdquo;
Investors are flocking to DGRW. The ETF, which pays a monthly dividend, now has $1.68 billion in assets under management, of which about $468 million has flowed into the fund this year.
<h3>A Rival</h3>
A familiar rival to DGRW is the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>). VIG focuses on U.S. large-caps that have boosted payouts for at least 10 consecutive years. Year to date, DGRW is topping VIG by more than 200 basis points, and over the past 36 months, the gap grows to 670 basis points in favor of the WisdomTree ETF.
CFRA has an overweight rating on VIG as well.
Disclosure: Todd Shriber owns shares of DGRW.
Related Links:
<a href="https://www.benzinga.com/trading-ideas/long-ideas/17/07/9809320/internal-focus-works-in-europe">The Right Way To Europe</a>
<a href="https://www.benzinga.com/news/earnings/17/07/9776865/2-ways-to-trade-this-weeks-healthcare-earnings">How To Play Healthcare Earnings</a>

AAPL

DGRW

A Star Among Dividend Growth ETFs

International dividend payers offer some advantages. Those perks include, in many cases, higher dividend yields than their U.S. counterparts and the potential to trim some of the volatility associated with investing in ex-U.S. markets.
<h3>Happy First Anniversary</h3>
Two exchange-traded funds that are coming up on their first anniversaries help investors generate income with ex-U.S. developed markets equities. The Vanguard International Dividend Appreciation ETF (NASDAQ: <a class="ticker" href="/stock/vigi#NASDAQ">VIGI</a>) and the Vanguard International High Dividend Yield ETF (NASDAQ: <a class="ticker" href="/stock/vymi#NASDAQ">VYMI</a>) <a href="https://www.benzinga.com/trading-ideas/long-ideas/16/12/8848483/a-boss-among-new-etfs">were the only new ETFs</a> introduced by Pennsylvania-based Vanguard, the second-largest U.S. ETF issuer, last year.
<h3>VIGI And VYMI</h3>
VIGI and VYMI have some well-known relatives. VIGI is the international equivalent of the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), the largest U.S. dividend ETF, while VYMI is the developed markets cousin to the Vanguard High Yield Dividend ETF (NYSE: <a class="ticker" href="/stock/vym#NYSE">VYM</a>).
VIGI &ldquo;emphasizes stocks exhibiting dividend growth and seeks to track the Nasdaq International Dividend Achievers Select Index, which comprises more than 200 all-cap developed and emerging markets stocks with a track record of increasing annual dividend payments,&rdquo; according to Vanguard.
&ldquo;Both these funds&#39; underlying indexes share similar methodologies to those underpinning their U.S. cousins. VYMI, for example, is tied to the FTSE All-World Ex-US High Dividend Yield Index. The index uses the FTSE All-World Index as its starting point,&rdquo; said <a href="http://news.morningstar.com/cover/videocenter.aspx?id=791459">Morningstar</a> in a recent note.
VIGI is neither an ex-North America ETF nor does it exclude emerging markets. Canada is the ETF&#39;s largest country allocation at 16.6 percent while India, China and South Africa combine for 19.6 percent of the ETF&#39;s geographic weight. VIGI holds just over 300 stocks with a median market cap of nearly $43 billion.
VYMI does not exclude Canadian stocks either, though the country is much smaller in this ETF than in VIGI. The U.K. is VYMI&#39;s largest country exposure at 16.7 percent. This new high yield dividend ETF also features emerging markets exposure as 18 developing economies, at varying weights, are found among VYMI&#39;s geographic lineup.
&ldquo;VYMI and VIGI are terrific options for investors looking for low-cost, diversified exposure to international dividend-paying stocks,&rdquo; added Morningstar.
At the end of last year, VYMI and VIGI had $243.4 million and $244.2 million in assets under management, respectively, making each among the most successful ETFs to come to market in 2016.

Emerging Markets

Eurozone

New ETFs

VYMI

Intriguing International Income Ideas

As has been the case in years past, 2016 has seen hundreds of new exchange-traded funds come to market. And as in previous years, many new ETFs are struggling to garner investors&#39; assets.
That does not mean all new ETFs are destined for failure. Sometimes it takes a while for a new ETF&#39;s concept to come into style or for investors to unearth the value in rookie ETFs. Still, new ETFs face an <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/11/8740683/gender-diversity-powers-a-rookie-etf">increasingly competitive landscape</a>, one that makes identifying the winners in terms of assets gathered among this year&#39;s infant ETFs easier.
A scant amount of this year&#39;s new ETFs have reached the much ballyhooed $100 million in assets under management mark. An even smaller amount have topped $200 million. One rookie ETF that dwells in the latter category is the Vanguard International Dividend Appreciation ETF (NASDAQ: <a class="ticker" href="/stock/vigi#NASDAQ">VIGI</a>).
<h3>Giving VIGI A Second Look</h3>
VIGI debuted in March alongside the Vanguard International High Dividend Yield ETF (NASDAQ: <a class="ticker" href="/stock/vymi#NASDAQ">VYMI</a>), marking the <a href="https://www.benzinga.com/trading-ideas/long-ideas/16/03/6791939/vanguard-adds-international-editions-of-its-popular-dividend-">only two new ETFs</a> launched by Pennsylvania-based Vanguard this year.
VIGI &ldquo;emphasizes stocks exhibiting dividend growth and seeks to track the Nasdaq International Dividend Achievers Select Index, which comprises more than 200 all-cap developed and emerging markets stocks with a track record of increasing annual dividend payments,&rdquo; according to Vanguard.
At the end of November, VIGI had $230.5 million in assets under management, easily making it one of this year&#39;s most successful new ETFs and putting it among just a handful of rookie ETFs to attract more than $200 million in assets.
<h3>Comparing VIGI To VIG</h3>
VIGI had some advantages when it came to market, not the least of which is the ETF is the international equivalent of the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), the largest U.S. dividend ETF.
&ldquo;As is the case with VIG, the fund&#39;s underlying index--the Nasdaq International Dividend Achievers Select Index--looks to home in on stocks that have a long history of paying and growing their dividends. As is also the case with VIG&#39;s index, the methodology document for this fund&#39;s bogy is lacking detail. What we know for sure is that in both cases, the result of the process defined by the indexes&#39; guiding principles is a portfolio of high-quality stocks,&rdquo; said Morningstar <a href="http://news.morningstar.com/articlenet/article.aspx?id=785928&amp;SR=Yahoo&amp;yptr=yahoo">in a recent note</a>.
VIGI, which blends developed markets exposure with a nearly 23 percent allocation to emerging markets dividend payers, has other positives.
&ldquo;As of the end of October, the stocks in VIGI&#39;s portfolio had an average return on invested capital of 13.62 percent, versus 10.44 percent for the average fund in its category. Additionally, 80.2 percent of VIGI&#39;s portfolio was invested in stocks that our analysts deem to have wide or narrow Morningstar Economic Moat Ratings, versus 69.6 percent for its average peer. Economic moats are evidence of a high-quality firm with sustainable competitive advantages,&rdquo; noted Morningstar.

A Boss Among New ETFs

Even with all the talk about rising interest rates in the United States, exchange-traded funds focusing on dividends are enjoying a banner 2016 when it comes to adding new assets &mdash; that, after dividend strategies struggled in 2015.
Dividend investing is usually most effective with long-term holding periods, but knowing that is only half the battle. With so many dividend exchange-traded funds on the market, selectivity is key even for investors looking to buy and hold.
&ldquo;Dividend investing is the hot ETF strategy of the year so far. The asset class has just experienced its largest quarterly inflow haul on record in Q3, when investors ploughed over $9 billion into the 268 globally listed funds tracked by the Markit ETP analytics database. This bumper result adds to the strong tally gathered by dividend ETFs in the opening half of the year; taking the net fund flows to $21.6 billion, nearly $3 billion more than the previous yearly record set back in 2013,&rdquo; said Markit <a href="http://www.markit.com/Commentary/Get/28102016-Equities-Dividend-ETFs-come-back-in-vogue-in-2016">in a recent note</a>.
<h3>A Popular Dividend ETF</h3>
For example, the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), the largest U.S. dividend ETF, has hauled in $1.44 billion in new assets this year. VIG&#39;s underlying index requires member firms to have dividend increase streaks of at least 10 years, meaning newer dividend growth stocks, such as Apple Inc. (NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>), <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/10/8590023/etfs-delivering-dividend-growth-the-right-way">are not found in VIG</a>.
<h3>Another Favorite</h3>
The WisdomTree High Dividend Fund (NYSE: <a class="ticker" href="/stock/dhs#NYSE">DHS</a>) has been another popular destination among dividend ETFs.
DHS&#39;s underlying index, the WisdomTree High Dividend Index (WTHYE) &ldquo;is dividend weighted annually to reflect the proportionate share of the aggregate cash dividends each component company is projected to pay in the coming year, based on the most recently declared dividend per share,&rdquo; <a href="http://www.wisdomtree.com/etfs/index-details.aspx?indexid=3">according to WisdomTree</a>.
DHS is a defensive ETF that marries two favored income themes: low volatility and dividend yield. The ETF&#39;s underlying index yields just over 4 percent with annualized volatility of under 18 percent, according to issuer data.
DHS has seen $275.1 million in year-to-date inflows, confirming investors&#39; thirst for higher-yielding equities.
&ldquo;The Vanguard Dividend Appreciation ETF is still the most popular dividend ETF, but its place at the top of the rankings is threatened as investors pick products that invest in stocks that offer a high yield over those that that have a track record of growing payments. This strong appetite for yield has seen the Vanguard High Dividend Yield ETF gather $3.1 billion of inflows. The high dividend yield offerings from Powershares and iShares have also proved popular with both finds outpacing their larger peer&rsquo;s $1.39 billion year to date inflow performance,&rdquo; added Markit.

Investors Lavish Praise And Dollars Upon Dividend ETFs

One of the biggest reasons, if not the biggest reason, behind investors&#39; affinity for real estate investment trusts (REITs) is the dividends. While REITs are known as a premier destination for income investors, not all dividend exchange-traded funds feature significant allocations to this asset class.
<h3>Dividends And REITs</h3>
&ldquo;All but three of the 97 Real Estate companies in the S&amp;P 1500 index paid a dividend as of the end of the third quarter of 2016. In particular, mid- and small-cap companies sport an above-average yield. Real Estate companies in the S&amp;P 400 and 600 indices had a yield of 4.0 percent and 4.3 percent, respectively, higher than the 1.6 percent and 1.3 percent yields for the broader indices,&rdquo; said <a href="https://www.cfraresearch.com/">CFRA Research</a> in a note out Tuesday.
<bzrelatedlink>Related Link: <a href="https://www.benzinga.com/general/education/16/10/8551249/the-u-s-cities-with-the-most-overvalued-and-undervalued-homes">The U.S. Cities With The Most Overvalued And Undervalued Homes</a></bzrelatedlink>
The Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>), the largest U.S. dividend ETF, features no exposure to REITs. VIG only allocates eight percent of its weight to financial services, the sector from which real estate recently separated. Three other sectors, industrials, consumer discretionary and staples, command larger chunks of VIG&#39;s lineup than do financials.
<h3>Looking Beyond Large-Cap Dividend ETFs</h3>
Investors do not have to focus on large-cap dividend ETFs to gain exposure to REITs. For example, the WisdomTree MidCap Dividend Fund (ETF) (NYSE: <a class="ticker" href="/stock/don#NYSE">DON</a>), one of the best-performing mid-cap funds over the past decade, active or passive, features solid real estate exposure.
&ldquo;The $2 billion product has a 16 percent stake in the new GICS sector, second only to consumer discretionary (18 percent of assets). Real estate holdings in the firm&#39;s proprietary index DON tracks include Senior Housing Properties (SNH) and VEREIT (VER). DHS has a 2.4 percent dividend yield,&rdquo; said CFRA.
Recently highlighted in this space, the PowerShares S&amp;P 500 High Dividend Low Volatility Portfolio (PowerShares Exchange-Traded Fund Trust II (NYSE: <a class="ticker" href="/stock/sphd#NYSE">SPHD</a>)) is another dividend ETF with significant real estate exposure.
PHD &ldquo;which combines dividend yield and low risk factors, has a 14 percent weighting in real estate. Here too, the sector is the second largest behind utilities (18 percent of assets). Host Hotels &amp; Resorts (HST) and HCP are among the ETF&#39;s top-10 holdings. SPHD has a 3.4 percent dividend yield,&rdquo; noted CFRA.
Like DON, SPHD pays a monthly dividend. CFRA has a marketweight rating on DON and an overweight rating on SPHD.
Disclosure: Todd Shriber owns shares of SPHD.
<a href="https://pro.benzinga.com/?utm_source=Benzinga&amp;utm_medium=Benzinga%20Top%20of%20Article&amp;am%22%3">Full ratings data available on Benzinga Pro.</a>
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REIT

Real Estate

SPHD

Finding Dividend ETFs With Healthy REIT Allocations

On Wednesday, BlackRock, Inc. (NYSE: <a class="ticker" href="/stock/blk#NYSE">BLK</a>), the world&#39;s largest asset manager, made waves in the exchange-traded funds industry by announcing lower fees for 15 of its iShares core ETFs. With that news, it can legitimately be said that iShares, the world&#39;s largest ETF issuer, is taking the fee fight to its competitors.
<h3>Price Wars?</h3>
In fact, many of the <a href="http://www.benzinga.com/news/16/10/8530578/blackrock-flexes-its-muscles-in-fee-battle-cuts-core-etf-prices">15 iShares core ETFs</a> that now have lower expense ratios are also now less expensive than the equivalent Vanguard ETFs. Yes, that is right. iShares now issues a slew of ETFs that are less expensive than the competing Vanguard funds. Perhaps the next fee news from Vanguard will be going to zero. After all, Vanguard is a financial services company in non-profit clothing. (Insert &ldquo;LOL&rdquo; and smiling emojis here.) Anyway, that is a story for another day.
<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/trading-ideas/long-ideas/16/10/8535786/a-hidden-gem-among-emerging-markets-etfs">A Hidden Gem Among Emerging Markets ETFs</a></bzrelatedlink>
The ongoing fee battles in ETF Land also strike at the heart of active management, which is fighting a seemingly losing battle on two fronts: higher fees with slack performances relative to cheaper index funds and ETFs.
&ldquo;In the 12 months ended August, actively managed large blend mutual funds and ETFs shed $57 billion in assets while passive products in the style gathered $108 billion, according to Morningstar,&rdquo; said <a href="http://trymsatoday.com/">S&amp;P Capital IQ</a> in a note out Wednesday. &ldquo;Not coincidentally, the SPIVA mid 2016 scorecard revealed that only 19 percent of active large cap core funds outperformed the S&amp;P 500 index in the one-year period ended June 2016. Looking back further, 12 percent and 8 percent of the active funds outperformed in the three- and five-year periods. Adoption of low-cost, passive products has been strong in a variety of equity and fixed income investment styles.&rdquo;
<h3>The Battle May Have Just Begun</h3>
With some of the new expense ratios on the iShares core ETFs, it will be hard if not impossible to find lower fees on competing product, at least until a rival fund issuer responds and there are no guarantees that will happen.
For example, the iShares S&amp;P 500 Index (ETF) (NYSE: <a class="ticker" href="/stock/ivv#NYSE">IVV</a>) is now charging 0.04 percent per year, or $4 on a $10,000 investment and one basis point different per year than the fee on the Vanguard 500 Index Fund (NYSE: <a class="ticker" href="/stock/voo#NYSE">VOO</a>).
Likewise, the new fees on the iShares Core Emerging Markets ETF (iShares Inc. (NYSE: <a class="ticker" href="/stock/iemg#NYSE">IEMG</a>)) and the iShares Core Dividend Growth ETF (iShares Trust (NYSE: <a class="ticker" href="/stock/dgro#NYSE">DGRO</a>)) are slightly below the expense ratios found on the Vanguard Emerging Markets Stock Index Fd (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>) and the Vanguard Dividend Appreciation ETF (NYSE: <a class="ticker" href="/stock/vig#NYSE">VIG</a>).
VIG and VWO are the largest ETFs tracking their respective asset classes.
&ldquo;VOO and IVV track the same index making comparisons relatively simple. For example, iShares Core MSCI Emerging Markets (IEMG) holds South Korean stocks and not China A shares while Vanguard FTSE Emerging Markets (VWO) tracks a different index and is constructed with the inverse approach. IEMG now costs 14 basis points, 1 basis point less than VWO,&rdquo; added S&amp;P Capital IQ.
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DGRO

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Inside BlackRock's ETF Fee Cuts

A $1.5 Million Inflation-Resistant Portfolio For Retiring With Dividends

A 7-Fund Portfolio For Big Dividends And Strong Growth

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If you&rsquo;re looking for reliability in a crazed market, jump into safer <a href="https://investorplace.com/stock-types/blue-chip-stocks/">blue-chip stocks</a>.



While they&rsquo;re not all the most exciting stocks on the market, they have proven themselves to be ultra-reliable in any economic environment.&nbsp;They all have proven business models, strong track records, sales, reputations and oftentimes, dividends to boot.&nbsp;That&rsquo;s because most offer products and services that millions of us use every day.&nbsp;



Even better, after a recent pullback in the broader markets, some of the top blue-chip stocks are on sale. Look at&nbsp;AT&amp;T&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/t-stock-quote/">T</a>), for example. After testing a high of $17.59, it pulled back to $16.33, where it caught support and is just starting to pivot higher. Plus, it&rsquo;s over-extended on RSI, MACD, and Williams&rsquo; %R, which tells us it&rsquo;s overdue to bounce. And while you wait for the AT&amp;T stock to recover, you can collect its yield of 6.8%.



Here are seven more top blue-chip stocks to buy and hold today.



<h2>Nike (NKE)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2019/08/nke-stock-1-300x169.jpg" alt="A stack of red Nike (NKE) shoe boxes."><div>Source: mimohe / Shutterstock.com</div></div>Over the last few weeks, shares of Nike (NYSE:<a href="https://investorplace.com/stock-quotes/nke-stock-quote/">NKE</a>) gapped from about $100 to a low of $88.80. However, it&rsquo;s starting to pivot higher, and could soon refill that gap at around $100. Helping,&nbsp;Bank of America analysts <a href="https://www.investopedia.com/nike-stock-rises-following-upgrade-from-bank-of-america-8630125#:~:text=Nike%20(NKE)%20shares%20rose%203.4,target%20to%20%24113%20from%20%24110.">just upgraded the NKE stock</a>&nbsp;to a buy rating with a price target of $113. The firm argues NKE has a newer line up of footwear and apparel products. Plus, the upcoming Olympics should have a positive impact on the stock, too.



JPMorgan also <a href="https://www.marketscreener.com/quote/stock/NIKE-INC-13739/news/NIKE-INC-JP-Morgan-reiterates-its-Buy-rating-46261519/">reiterated its overweight rating</a> on the stock&nbsp;with a price target of $164. The firm pointed to Nike&rsquo;s improvement in China. In addition, Morgan Stanley says retailers are seeing improving sequential demand trends for athletic apparel.



Better, earnings negativity has been priced into the stock. Investors weren&rsquo;t too enthused when the company said growth was near zero, or that management expected for revenue to pull back in the first half of fiscal 2025, which starts in June. But again, that appears to be priced in.



<h2>Realty Income (O)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2019/07/realty1600-300x169.jpg" alt="realty income logo highlighted by a magnifying glass on a web browser"><div>Source: Shutterstock</div></div>There&rsquo;s also &ldquo;The Monthly Dividend Company,&rdquo;&nbsp;Realty Income (NYSE:<a href="https://investorplace.com/stock-quotes/o-stock-quote/">O</a>). 



With a yield of 5.93%, the real estate investment trust (REIT) is also a buy on weakness. In fact, after slipping from $54.39 to $50.65, it&rsquo;s now starting to pivot higher again. Better, while we wait for it to recover, we can collect its monthly dividend. Its latest one for 25.7 cents is payable on May 15 to shareholders of record as of May 1. This is the company&rsquo;s 646th consecutive monthly dividend with many more on the way.



Realty Income has been around for more than 50 years now. It has 13,100 properties, and it&rsquo;s still seeing strong demand with an occupancy rate of 99%.&nbsp;



Some of its top tenants include&nbsp;Dollar General (NYSE:<a href="https://investorplace.com/stock-quotes/dg-stock-quote/">DG</a>), Walgreen&rsquo;s (NASDAQ:<a href="https://investorplace.com/stock-quotes/wba-stock-quote/">WBA</a>), Dollar Tree (NASDAQ:<a href="https://investorplace.com/stock-quotes/dltr-stock-quote/">DLTR</a>), FedEx (NYSE:<a href="https://investorplace.com/stock-quotes/fdx-stock-quote/">FDX</a>), BJ&rsquo;s (NYSE:<a href="https://investorplace.com/stock-quotes/bj-stock-quote/">BJ</a>), CVS (NYSE:<a href="https://investorplace.com/stock-quotes/cvs-stock-quote/">CVS</a>), Walmart&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/wmt-stock-quote/">WMT</a>) and Lowe&rsquo;s (NYSE:<a href="https://investorplace.com/stock-quotes/low-stock-quote/">LOW</a>) to name just a few. It&rsquo;s definitely one of the top blue-chip stocks to buy and hold for the long haul.



<h2>Fidelity Blue Chip Growth ETF (FBCG)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2020/10/fidelity-1600-300x169.jpg" alt="Fidelity sign"><div>Source: Jonathan Weiss / Shutterstock.com</div></div>Or, if you want to diversify at low cost with blue-chip stocks, there&rsquo;s always an exchange-traded fund, such as the Fidelity Blue Chip Growth ETF (CBOE:<a href="https://investorplace.com/stock-quotes/fbcg-stock-quote/">FBCG</a>).



With an expense ratio of 0.59%, the ETF &ldquo;focuses on companies we believe have above-average earnings growth potential with sustainable business models, for which the market has mispriced the rate and/or durability of growth,&rdquo; as noted by Fidelity.&nbsp;



Top holdings include&nbsp;Nvidia (NASDAQ:<a href="https://investorplace.com/stock-quotes/nvda-stock-quote/">NVDA</a>), Apple (NASDAQ:<a href="https://investorplace.com/stock-quotes/aapl-stock-quote/">AAPL</a>), Microsoft (NASDAQ:<a href="https://investorplace.com/stock-quotes/msft-stock-quote/">MSFT</a>), Amazon (NASDAQ:<a href="https://investorplace.com/stock-quotes/amzn-stock-quote/">AMZN</a>), and Meta Platforms (NASDAQ:<a href="https://investorplace.com/stock-quotes/meta-stock-quote/">META</a>) to name a few.



Even more impressive, since bottoming out at around $27 in late October, the ETF hit a high of about $39. It just recently pulled back with the broader market to $36.84. Now oversold on RSI, MACD, and Williams&rsquo; %R, that weakness is an opportunity. From its current price of $36.84, I&rsquo;d like to see the ETF challenge $40 a share initially.&nbsp;



What&rsquo;s nice about an ETF like this one is we can diversify with top blue-chip stocks. All for less than $37 a share at the moment.



<h2>Vanguard Dividend Appreciation Index Fund (VIG)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2019/08/vanguard1600-1-300x169.jpg" alt="vanguard website displayed on a mobile phone screen representing vanguard etfs"><div>Source: Shutterstock</div></div>Another hot blue-chip ETF to consider is the Vanguard Dividend Appreciation Index Fund (NYSEARCA:<a href="https://investorplace.com/stock-quotes/vig-stock-quote/">VIG</a>).



With an expense ratio of 0.06%, the VIG ETF currently yields 1.76%. its last payout of 76.92 cents was paid on March 27. The next one should be out by June. It also holds 340 stocks, including Microsoft, Apple, Broadcom (NASDAQ:<a href="https://investorplace.com/stock-quotes/avgo-stock-quote/">AVGO</a>),&nbsp;Exxon Mobil (NYSE:<a href="https://investorplace.com/stock-quotes/xom-stock-quote/">XOM</a>), Visa (NYSE:<a href="https://investorplace.com/stock-quotes/v-stock-quote/">V</a>), MasterCard&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/ma-stock-quote/">MA</a>), and&nbsp;Home Depot&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/hd-stock-quote/">HD</a>). All in its effort to track the performance of the S&amp;P U.S. Dividend Growers Index.



Since bottoming out at around $150, the VIG ETF ran to a high of $183.02. Since then, it has dipped to $173.63, where it&rsquo;s over-extended on RSI, MACD, and Williams&rsquo; %R. From its last traded price, I&rsquo;d like to see it initially retest $182.07 and head to $200 near term.



What&rsquo;s nice about this ETF is we can gain exposure to 340 of the world&rsquo;s top stocks. All for less than $175 a share at the moment. Plus, we can collect its yield as it appreciates.



<h2>Procter &amp; Gamble (PG)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2022/01/shutterstock_1073950868-300x169.png" alt="Procter &amp; Gamble Union Distribution Center. P&amp;G is an American Multinational Consumer Goods Company"><div>Source: Jonathan Weiss / Shutterstock.com</div></div>We can also look at&nbsp;Procter &amp; Gamble&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/pg-stock-quote/">PG</a>), which we&rsquo;re all familiar with.



With a yield of 2.56%, the consumer goods company is also a buy on recent weakness. After pulling back from about $160, it&rsquo;s now technically oversold at $157.29. It&rsquo;s also over-extended on RSI, MACD, and Williams&rsquo; %R and is just starting to pivot higher. Initially, I&rsquo;d like to see the PG stock retest its prior high and push to at least $170 near term.



It also just raised its&nbsp;<a href="https://finance.yahoo.com/news/p-g-declares-dividend-increase-201500039.html">quarterly dividend to $1.0065</a>, a 7% jump from its prior dividend of 94.07 cents. It&rsquo;s payable on May 15 to shareholders of record as of April 19.



Helping,&nbsp;Barclays <a href="https://markets.businessinsider.com/news/stocks/barclays-sticks-to-its-buy-rating-for-procter-gamble-pg-1033243823">just reiterated a buy rating</a> on the PG&nbsp;stock with a price target of $168. Analysts at Deutsche Bank also raised their price target to $172 with a buy rating. The firm says &ldquo;year-to-date consumption trends for Procter remain solid in tracked channels. The firm sees little risk to near-term earnings numbers given the company&rsquo;s ongoing productivity momentum and relative cost favorability,&rdquo;&nbsp;<a href="https://thefly.com/news.php?symbol=PG">as noted by TheFly.com</a>.



<h2>Genuine Parts (GPC)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2020/08/auto-stocks-1600-300x169.jpg" alt="An angled side view of a row of parked cars. automotive stock picks"><div>Source: lumen-digital / Shutterstock.com</div></div>The last time I mentioned&nbsp;Genuine Parts (NYSE:<a href="https://investorplace.com/stock-quotes/gpc-stock-quote/">GPC</a>), it traded at $135 on Nov. 17. 



<a href="https://investorplace.com/2023/11/3-blue-chip-stocks-you-can-snag-at-an-all-time-low/">At the time, I noted</a>, &ldquo;Use the weakness as an opportunity. While we wait for the eventual recovery here, we can collect its 2.76% yield. We can profit from capital appreciation, and get paid to wait.&rdquo; Just a few months later, GPC is now up to $160.23 and could see higher highs.



Now yielding 2.5%, the stock rocketed 11.2% higher on Thursday after raising its fiscal year 2024 profit guidance. For the year, it expected to post EPS of $8.95 to $9.15. Now it expects to post EPS of $9.05 to $.9.20, which boosted investor confidence.&nbsp;



Even better, its dividend &ndash; which has been increased consistently for 67 years &ndash; is safe. In the first three months of 2024,&nbsp;<a href="https://www.genpt.com/2024-04-18-Genuine-Parts-Company-Reports-First-Quarter-2024-Results-and-Updates-Full-Year-Outlook">the company said it</a>&nbsp;&ldquo;used&nbsp;$175 million&nbsp;in cash for financing activities, including&nbsp;$133 million&nbsp;for quarterly dividends paid to shareholders and&nbsp;$38 million&nbsp;for stock repurchases. Free cash flow was&nbsp;$203 million.&rdquo;



<h2>Coca-Cola (KO)</h2>



<div><img width="300" height="169" src="https://investorplace.com/wp-content/uploads/2022/02/coke-stock-1-300x169.jpg" alt="The website for Coca-Cola Consolidated (COKE) displayed on a smartphone screen."><div>Source: IgorGolovniov / Shutterstock.com</div></div>Coca-Cola&nbsp;(NYSE:<a href="https://investorplace.com/stock-quotes/ko-stock-quote/">KO</a>) looks good on weakness, too.



After dropping to $58.18 from $61, it&rsquo;s now oversold on RSI, MACD and Williams&rsquo; %R. But it is starting to bounce back fast. From its last traded price of $58.91, I&rsquo;d like to see it retest $61. Better, while we wait for it to recover, we can collect its yield of about 3.3%. Its latest dividend of 48.5 cents was recently paid out on April 1. Annualized, it&rsquo;s $1.94 and is the company&rsquo;s 62nd consecutive annual dividend increase.&nbsp;



Plus, &ldquo;The company returned $8 billion in dividends to shareowners in 2023, bringing the total amount of dividends paid to shareowners since Jan. 1, 2010, to $84.7 billion,&rdquo;&nbsp;<a href="https://investors.coca-colacompany.com/news-events/press-releases/detail/1102/board-of-directors-of-the-coca-cola-company-approves-62nd#:~:text=The%20company%20returned%20%248%20billion,%2C%202010%2C%20to%20%2484.7%20billion.&amp;text=The%20Coca%2DCola%20Company%20(NYSE,than%20200%20countries%20and%20territories.">as noted in a recent press release</a>. Helping, analysts at Barclays just raised their price target on KO to $68 with an overweight rating. All as the company continues to grow its revenue, as the global soft drink market continues to explode.



On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com&nbsp;<a href="https://investorplace.com/corporate/investorplace-publishing-guidelines/" target="_blank">Publishing Guidelines.</a>
<div>Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.</div><h3>More From InvestorPlace</h3>
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The post <a href="https://investorplace.com/2024/04/put-50000-in-these-7-blue-chip-stocks-today/">Put $5,000 in These 7 Blue-Chip Stocks Today</a> appeared first on <a href="https://investorplace.com">InvestorPlace</a>.