VYM - VYM Vs. Its Competitors Shows A Mixed Picture

2024-06-17 07:00:00 ET

Summary

• The Vanguard High Dividend Yield Index Fund ETF aims to track FTSE High Dividend Yield Index.
• The Vanguard Total Stock Market Index Fund ETF is used to compare VYM in terms of both yield and total return. Both VYM and VTI are Large-Cap ETFs.
• Along with reviewing both of those ETFs and comparing income and returns, VYM is also compared to competing dividend-focused ETFs.
• After all of that analysis, I gave VYM a Hold rating. It is questionable whether using an equity ETF for enhancing income is the best strategy.

Introduction

I am in the process of reconfiguring my father’s portfolio now that he died, and income generating is more critical than growth as it has to fund my 93-year-old mother's expenses. He only owned well known large-cap stocks like Johnson & Johnson ( JNJ ) and Walmart ( WMT ). The average yield was about 3%. Along with adding fixed income assets, I want to use an ETF for part of that equity allocation....

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