Key Points
The Vanguard Dividend Appreciation ETF (NYSEMKT: VIG) demonstrates a blend of income and growth investments, counteracting the perception that dividend-focused ETFs lack exposure to growth stocks. Notably, three of its top four holdings—Broadcom (NASDAQ: AVGO), Apple (NASDAQ: AAPL), and Microsoft (NASDAQ: MSFT)—constitute about 13% of the ETF’s assets, highlighting a significant tech orientation.
This unique structure allows for defensive sector exposure alongside growth prospects, with dividend yields from these tech companies ranging from 0.4% to 0.8%. Microsoft’s dividend has grown by 63% over five years, with Broadcom’s increase exceeding 80%. These factors suggest that VIG can offer diversification for investors lacking growth stocks in their portfolios.
