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Vanguard Adds International Editions Of Its Popular Dividend ETFs

ETF Professor

The Vanguard Dividend Appreciation ETF (NYSE: VIG) and the Vanguard High Dividend Yield ETF (NYSE: VYM) had $18.8 billion and $11.3 billion in assets under management, respectively, at the end January making the pair two of the four largest U.S. dividend ETFs.

With the success of VIG and VYM, it is not surprising that Vanguard would give international versions of the ETFs a whirl. That is exactly what the issuer did Wednesday with the debuts of the Vanguard Dividend Appreciation ETF (NYSE: VIGI) and Vanguard International High Dividend Yield ETF (NASDAQ: VYMI).

Those funds are the first new ETFs from Pennsylvania-based Vanguard since the coming introduced the Vanguard Tax-Exempt Bond ETF (NYSE: VTEB) came to market. Prior to that, Vanguard had not launched a new ETF in nearly two years.

VYMI, the high dividend yield ETF, will track the “FTSE All-World ex US High Dividend Yield Index, a benchmark of more than 800 of the highest yielding large- and mid-cap developed and emerging markets securities,” said Vanguard in a statement.

The new ETF charges 0.3 percent per year and the median market value of its components is $43.1 billion, according to Vanguard data.

VIGI “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,” said Vanguard in the statement.

The median market of the 209 stocks in VIGI's underlying index is $37.9 billion. The The Nasdaq International Dividend Achievers Index, VIGI's benchmark, which debuted in September, holds stocks with minimum dividend increase streaks of seven years. VIG's' holdings have a minimum dividend increase streak of a decade.

VIGI charges 0.25 percent, or $25 per $10,000 invested, a year.

“Since introducing its first ETF in 2001, Vanguard has emerged as an ETF leader and now manages more than $507 billion in global ETF assets. Investors entrusted more than $82 billion to Vanguard ETFs in 2015 – the most in the firm’s history,” said Vanguard.

Vanguard is the second-largest U.S. ETF issuer.

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