VIG - DGRW: A Dividend Growth Fund Needs A Growing Dividend

2024-03-16 01:23:49 ET

Summary

• Dividend investing has become controversial as interest rates rise, causing dividend ETFs to underperform the S&P 500.
• Dividend ETFs can be categorized into core dividend funds, high-yield dividend funds, and dividend growth funds.
• WisdomTree U.S. Quality Dividend Growth Fund is a dividend growth fund that prioritizes quality and growth potential over current yield.
• Performance has been strong, beating competing dividend funds over the past twelve months.
• DGRW's dividend has declined three out of the past ten years.

Dividend investing has become a controversial topic as interest rates rise. Dividends have long been a reliable source of income for investors and retirees. Dividends gained traction during the zero-interest policy era, where they offered an attractive income stream as compared to a treasury that yielded nil. The 3%-4% yields offered by dividend ETFs and mutual funds produced more income than traditional assets like certificates of deposits, treasuries, or bonds. Investors were drawn to dividend equities as few alternatives remained....

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