{"id":29475,"date":"2012-05-04T10:18:29","date_gmt":"2012-05-04T14:18:29","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/2012\/05\/vym-the-best-high-dividend-yield-etf\/"},"modified":"2012-05-04T10:18:29","modified_gmt":"2012-05-04T14:18:29","slug":"vym-the-best-high-dividend-yield-etf","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2012\/05\/04\/vym-the-best-high-dividend-yield-etf\/","title":{"rendered":"VYM: The Best High Dividend Yield ETF?"},"content":{"rendered":"<p>Article by <a href=\"http:\/\/www.investmentu.com\/\" target=\"_blank\">Investment U<\/a> <\/p>\n<div><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-29194\" title=\"VYM: The Best High Dividend Yield ETF?\" src=\"http:\/\/www.investmentu.com\/wp-content\/uploads\/2012\/05\/vym-best-dividend-yield-etf.jpg\" alt=\"VYM: The Best High Dividend Yield ETF?\" width=\"220\" height=\"220\" \/><\/p>\n<p>One dividend ETF to consider is the Vanguard High Dividend Yield ETF (NYSE: VYM).<\/p>\n<\/div>\n<p>When dealing with your retirement savings you need to remember a couple things:<\/p>\n<ul>\n<li>First, always remember to be focused on the long term.<\/li>\n<li>Second, you want something that\u2019s high-quality, low-maintenance and beats the overall market.<\/li>\n<\/ul>\n<p>I know, it sounds pretty obvious, but it\u2019s not always easy to find investments with all of those qualities\u2026<\/p>\n<p>Some people like mutual funds and others are jumping on the ETF bandwagon. However, besides the pricing, is there any difference in using one or the other for retirement investing?<\/p>\n<p>Let\u2019s see\u2026<strong><\/strong><\/p>\n<h2><strong>It\u2019s Not What it Used to Be\u2026<\/strong><\/h2>\n<p>The expense difference between mutual funds and ETFs isn\u2019t what it used to be.<\/p>\n<p>About two years ago, possibly the biggest factors in buying ETFs was that they had lower expense ratios than most index funds.<\/p>\n<p>On the flip side, you had to pay a commission to buy them since they can only be traded through brokerage accounts.<\/p>\n<p>But now the difference isn\u2019t so big because:<\/p>\n<ul>\n<li>Lately a number of brokerages like Vanguard, Fidelity and Schwab allow for commission-free trades of certain low-cost ETFs.<\/li>\n<li>ETFs no longer lead the way with low expense ratios. If you have $10,000 or more to invest in a given fund, you can have access to the \u201cAdmiral shares\u201d of most Vanguard funds. They usually have expense ratios as low as the lowest-cost ETFs. (Before October 2010, the Admiral shares had a minimum initial investment of $100,000 rather than $10,000.)<\/li>\n<\/ul>\n<h2><strong>Lump Sums vs. Monthly Contributions<\/strong><\/h2>\n<p>The right choice between a mutual fund and ETF may just come down to whether you want to invest a big chunk of money all at once or smaller chunks of money over time.<\/p>\n<p>If you want to invest a big chunk at once &#8211; for example, you&#8217;re doing a rollover of a 401(k) or an IRA &#8211; you&#8217;re better off with an ETF.<\/p>\n<p>By contrast, if you want to invest $300 a month (or make smaller contributions now and then), you&#8217;re probably better off in a regular mutual fund; overall, the fees will be lower.<\/p>\n<h2><strong>If You\u2019re Going the Lump Sum Route\u2026<br \/>\n<\/strong><\/h2>\n<p>One of the best ETFs to consider if you\u2019re going the lump-sum route is <strong>Vanguard High Dividend Yield ETF <\/strong>(NYSE: <a href=\"http:\/\/www.etftrends.com\/etf-resume.php?quote=vym\" target=\"_self\">VYM<\/a>). VYM<strong> <\/strong>tracks the FTSE High Dividend Yield Index \u2013 a custom index that the FTSE Group developed with Vanguard.<\/p>\n<p>The index is constructed from U.S. stocks with higher-than-average dividend yields, and it contains no REITs or stocks that aren&#8217;t expected to make a dividend payout over the next 12 months.<\/p>\n<p>Fees make an <em>enormous<\/em> difference to long-term investment returns! The ETF&#8217;s expense ratio of 13 basis points (0.13%) makes it cheaper than 89% of its peers. And imagine all the transaction fees you\u2019re saving from investing in each company individually.<\/p>\n<p>Here are the month-end 10 largest holdings (34.2% of total net assets) as of 2\/29\/2012:<\/p>\n<ol>\n<li><strong>Exxon Mobil Corp.<\/strong> (NYSE: XOM)<\/li>\n<li><strong>Microsoft Corp.<\/strong> (Nasdaq: MSFT)<\/li>\n<li><strong>Chevron Corp.<\/strong> (NYSE: CVX)<\/li>\n<li><strong>General Electric Co.<\/strong> (NYSE: GE)<\/li>\n<li><strong>Procter &amp; Gamble Co.<\/strong> (NYSE: PG)<\/li>\n<li><strong>AT&amp;T Inc.<\/strong> (NYSE: T)<\/li>\n<li><strong>Johnson &amp; Johnson<\/strong> (NYSE: JNJ)<\/li>\n<li><strong>Pfizer Inc.<\/strong> (NYSE: PFE)<\/li>\n<li><strong>Coca-Cola Co.<\/strong> (NYSE: KO)<\/li>\n<li><strong>Wal-Mart Stores Inc. <\/strong>(NYSE: WMT)<\/li>\n<\/ol>\n<p>So what do you get for your retirement account?<\/p>\n<ul>\n<li>A diversified mix of some of the best dividend payers out there that will send you a dividend check every quarter.<\/li>\n<li>A current yield at 3.2% according to Morningstar. It\u2019s historically yielded one percentage point more than the <strong>S&amp;P 500 Index<\/strong>.<\/li>\n<\/ul>\n<p>And that\u2019s not too shabby.<\/p>\n<p>Good Investing,<\/p>\n<p>Jason Jenkins<\/p>\n<div>\n<a href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=jXRBJfpApGo:8SBrA2LLwps:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?d=yIl2AUoC8zA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=jXRBJfpApGo:8SBrA2LLwps:V_sGLiPBpWU\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=jXRBJfpApGo:8SBrA2LLwps:V_sGLiPBpWU\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=jXRBJfpApGo:8SBrA2LLwps:qj6IDK7rITs\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?d=qj6IDK7rITs\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=jXRBJfpApGo:8SBrA2LLwps:gIN9vFwOqvQ\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=jXRBJfpApGo:8SBrA2LLwps:gIN9vFwOqvQ\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?a=jXRBJfpApGo:8SBrA2LLwps:F7zBnMyn0Lo\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/InvestmentU?i=jXRBJfpApGo:8SBrA2LLwps:F7zBnMyn0Lo\" border=\"0\"><\/img><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/InvestmentU\/~4\/jXRBJfpApGo\" height=\"1\" width=\"1\" \/><\/p>\n<p>Article by <a href=\"http:\/\/www.investmentu.com\/\" target=\"_blank\">Investment U<\/a> <\/p>\n","protected":false},"excerpt":{"rendered":"<p>Article by Investment U One dividend ETF to consider is the Vanguard High Dividend Yield ETF (NYSE: VYM). When dealing with your retirement savings you need to remember a couple things: First, always remember to be focused on the long term. Second, you want something that\u2019s high-quality, low-maintenance and beats the overall market. I know, &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/www.investmacro.com\/forex-news\/2012\/05\/04\/vym-the-best-high-dividend-yield-etf\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;VYM: The Best High Dividend Yield ETF?&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-29475","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29475","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=29475"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29475\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=29475"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=29475"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=29475"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}