RDVY vs VIG

RDVYCFirst Trust Rising Dividend Achievers ETF

VIGAVanguard Dividend Appreciation ETF

In short

RDVY A dividend fund built around raises, not yield: roughly 50 equal-weighted US names, a quarter of the roster refreshed each quarter, and an index rule that ejects companies which slash or suspend the payout.

VIG VIG buys dividend growth, not fat yields: about 300 US companies with a record of raising their payouts, tracked for 0.04% a year. Running since 2006 and now north of $100 billion, it is the plain-vanilla anchor of the dividend-screen aisle.

Stated mandate

RDVY The Fund seeks investment results that generally correspond to the price and yield of the Nasdaq US Rising Dividend AchieversTM Index before fees and expenses.

VIG The fund seeks to track the S&P U.S. Dividend Growers Index, which represents common stocks of companies with a record of increasing dividends over time.

Why people hold it

• RDVY The index doesn't wait for the annual reshuffle. Under Nasdaq's rules, a holding that suspends its dividend or cuts it by 50% or more is removed the following month.nasdaqomx.com
• Four sub-portfolios, each reconstituted in its own quarter and reset to 25% of the index every March. Turnover happens in rolling slices instead of one annual lump.nasdaqomx.com
• Equal weighting across about 50 stocks. No single mega-cap steers the portfolio the way it can in cap-weighted dividend index funds.nasdaqomx.com
• Live since 2014 and now a multi-billion-dollar, actively traded fund, so getting in and out is rarely the hard part.

• VIG At 0.04% a year, the fee is roughly a tenth of the typical dividend-screen fund's 0.39%, and undercuts every other top-graded fund in the group, DGRO and SCHD included.
• The screen rewards a record of increasing dividends rather than the biggest current payout, so the basket leans on payout discipline instead of stretched yields.
• Live since 2006, over $100 billion in assets and actively traded, which shows up as easy fills rather than wide spreads.
• About 300 holdings, cash paid quarterly, and one of the strongest overall implementations in its dividend-screen peer group.

Worth knowing

• RDVY 0.47% a year sits above the median US dividend-screen fund and runs many multiples of the category's index staples: SCHD at 0.06%, VIG at 0.04%, DGRO at 0.08%.
• About 50 equal-weighted names is a concentrated way to own dividend growth. Each position carries real weight, and sector tilts can run hotter than a broad-market fund's.nasdaqomx.com
• The mandate tracks an index of rising dividend payers, not the highest yields on offer. Different job than a high-yield fund. Distributions come quarterly.

• VIG Growth of payouts, not maximum income, is the mandate. That puts it on a different axis than high-dividend funds such as SPYD.
• US stocks only, no bonds and no overseas payers, and sector weights are whatever the index screen spits out.
• Portfolio risk and concentration measures land mid-pack for the category: it is fully invested in equities and drops when the market drops.

Full RDVY profile⁠

Full VIG profile⁠