Four popular dividend ETFs, four different rulebooks. Here is what each index selects, what that does to yield, dividend growth, sectors and total return over the same dates, and which goal each one fits.
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If the goal is the most dividend income today, SCHD and VYM fit; if the goal is income that grows faster than inflation over decades, VIG and DGRO fit, with SCHD in between; if you want the broadest spread of stocks, VYM fits. None of the four is a substitute for a total‑market fund: each trailed the S&P 500 over 10 years and leans toward particular sectors.
Scope. US dividend ETFs held as part of a retirement portfolio. It excludes option‑income funds (see JEPI vs SCHD), international dividend funds and individual dividend stocks. Hub: how to choose ETFs for retirement.
| Fund | Index (verified on issuer page) | Entry rule | Yield screen | Holdings |
|---|---|---|---|---|
| SCHD (Schwab) | Dow Jones U.S. Dividend 100 | At least 10 consecutive years of dividend payments; ranked on cash flow to debt, return on equity, yield and dividend growth | Yield must rank in the top half of eligible stocks | 102 |
| VYM (Vanguard) | FTSE High Dividend Yield | Stocks forecast to have above‑average dividend yields | Favors high yield; excludes REITs | 593 |
| DGRO (iShares) | Morningstar US Dividend Growth | At least 5 years of uninterrupted annual dividend growth; payout ratio under 75% | Excludes the top 10% by yield | 391 |
| VIG (Vanguard) | S&P U.S. Dividend Growers | At least 10 consecutive years of dividend increases | Excludes the top 25% highest yielders | 333 |
Index rules from S&P Dow Jones Indices, FTSE (via Vanguard’s fact sheet) and Morningstar Indexes. All four exclude REITs. DGRO weights stocks by the dividend dollars they pay, with a 3% cap. VIG tracked a Nasdaq dividend index until Sep 19, 2021, so its long record is partly on a different rulebook. The rulebooks explain everything that follows: a quality‑and‑yield screen (SCHD), a broad yield tilt (VYM) and two growth screens that deliberately skip the highest yields (DGRO, VIG).
| SCHD | VYM | DGRO | VIG | |
|---|---|---|---|---|
| Expense ratio | 0.06% | 0.04% | 0.08% | 0.04% |
| Stocks held | 102 | 593 | 391 | 333 |
| 30‑day SEC yield | 3.12% (Oct 22) | 2.35% (Sep 30) | 2.07% (Sep 30) | 1.51% (Sep 30) |
| Trailing 12‑month distribution yield (Sep 30, 2026) | 3.24% | 2.37% | 1.98% | 1.56% |
| Top‑10 weight | 41.7% | 26.2% | 27.2% | 34.6% |
| Largest holdings | Texas Instruments 4.4%, Procter & Gamble 4.3%, Chevron 4.3% | Broadcom 6.9%, JPMorgan 3.8%, ExxonMobil 2.9% | ExxonMobil 3.3%, Microsoft 3.2%, Apple 3.1% | Microsoft 4.9%, Apple 4.9%, Broadcom 4.3% |
| Top sectors | Consumer defensive 20.1%, health care 19.3%, technology 16.0%, energy 15.3% | Financials 20.9%, technology 17.5%, health care 14.1%, industrials 11.6% | Financials 19.2%, technology 17.8%, health care 17.4%, staples 12.8% | Technology 27.4%, financials 20.7%, health care 18.7%, industrials 10.8% |
| Launched | Oct 2011 | Nov 2006 | Jun 2014 | Apr 2006 |
Expense ratio, stocks held and SEC yield from the issuers (2026); distribution yields from Exent market data (to Sep 30, 2026); top‑10 weights, largest holdings and sectors from Exent market data fund holdings (Oct 20, 2026). Sector labels come from different classification systems, so treat them as approximate. SCHD is the most concentrated and the most tilted to staples and energy; VIG looks most like the broad market, with technology at 27.4%, though still far below the S&P 500’s about 40% (39.7% information technology in VOO, Vanguard, Sep 30, 2026). Fund pages: SCHD, VYM, DGRO, VIG.
| Fund | 12‑month yield (Sep 30, 2026) | Paid per share, 2020 | Paid per share, 2025 | 5‑year dividend growth |
|---|---|---|---|---|
| SCHD | 3.24% | $0.6763 | $1.0476 | 9.15% a year |
| VYM | 2.37% | $2.9061 | $3.5008 | 3.79% a year |
| DGRO | 1.98% | $1.0288 | $1.4507 | 7.11% a year |
| VIG | 1.56% | $2.2965 | $3.5580 | 9.15% a year |
How we computed it (Exent calculation from Exent market data): we added up each fund’s distributions by ex‑date for calendar 2020 and 2025 (SCHD adjusted for its 3‑for‑1 split in October 2024), then took the annual growth rate: (2025 ÷ 2020)^(1/5) − 1. For SCHD, (1.0476 ÷ 0.6763)^0.2 − 1 = 9.15%; for VIG, (3.5580 ÷ 2.2965)^0.2 − 1 = 9.15%. 2020 was a pandemic year with some dividend cuts, which flatters growth a little for every fund. Past dividend growth is not a forecast, and fund payouts can be cut. A yield is also only half of the return: the share price drops by about the amount paid (see dividend yield and total return).
| Total return | SCHD | VYM | DGRO | VIG | S&P 500 (SPY) |
|---|---|---|---|---|---|
| 2021 | +29.9% | +26.2% | +26.6% | +23.8% | +28.7% |
| 2022 | −3.2% | −0.5% | −7.9% | −9.8% | −18.2% |
| 2023 | +4.6% | +6.6% | +10.5% | +14.5% | +26.2% |
| 2024 | +11.7% | +17.6% | +16.6% | +17.0% | +24.9% |
| 2025 | +4.3% | +15.4% | +15.7% | +14.2% | +17.7% |
| 2026 to Sep 30 (NAV) | +21.5% | +10.0% | +10.1% | +7.4% | +12.7% |
| 10 years to Sep 30, 2026, a year (NAV) | 12.4% | 11.3% | 13.2% | 12.9% | 15.2% |
| COVID drop, Feb 19–Mar 23, 2020 | −32.7% | −34.6% | −34.8% | −31.6% | −33.7% |
| 2022 drop, Jan 3–Oct 12 | −16.8% | −15.9% | −19.3% | −20.4% | −24.5% |
Calendar years and drops: Exent market data, daily closes with distributions reinvested, the same dates for every fund. 2026 and 10‑year figures: issuer NAV returns to Sep 30, 2026. Dividend funds cushioned the 2022 bear market, but in the 2020 crash they fell about as far as the S&P 500. Leadership rotated: SCHD was last in 2023 and 2025 and first in 2026 so far, helped by its energy weight. Over 10 years the growth screens (DGRO, VIG) beat the yield screens (SCHD, VYM), and the market beat them all. For a deeper drawdown history, see how to analyze a dividend portfolio.
| Fund | Pros | Cons |
|---|---|---|
| SCHD | Highest yield of the four (3.24% trailing, 3.12% SEC); quality screen on cash flow and return on equity; 9.15% yearly dividend growth 2020–2025; low 0.06% fee. | Only about 100 stocks and 41.7% in the top 10; heavy staples and energy; trailed the S&P 500 by 21.6 points in 2023 and 13.4 in 2025. |
| VYM | Broadest (593 stocks), lowest top‑10 weight (26.2%); 0.04% fee; smallest 2022 loss (−0.5% for the year). | Slowest dividend growth (3.79% a year); lowest 10‑year return of the four (11.28%); large single position in Broadcom (6.9%). |
| DGRO | Best 10‑year return of the four (13.16%); 391 stocks; skips the highest yields and payout ratios over 75%, which screens out many yield traps. | Lower yield (1.98%); highest fee of the four (0.08%, still low); deeper 2022 drop (−19.3%). |
| VIG | Requires 10 straight years of increases; 9.15% yearly dividend growth; closest to the broad market; 0.04% fee. | Lowest yield (1.56%) so it does little for income now; deepest 2022 drop (−20.4%); index changed in 2021. |
In a taxable account, most dividends from these funds are qualified, taxed at 0%, 15% or 20% depending on income, if you held the shares more than 60 days during the 121‑day window around the ex‑dividend date (IRS Publication 550). Vanguard notes that its high‑yield index excludes REITs because REIT payouts generally do not get those rates. ETFs rarely distribute capital gains: State Street found only 7% of ETFs paid one in 2025, against 52% of mutual funds.
The catch is that dividends are taxed every year whether you need them or not. A retiree spending the income loses little to that; someone still saving pays tax on cash they reinvest. In an IRA or 401(k), taxes do not change the comparison. See tax‑efficient ETFs for a taxable account and living off dividends.
Exent calculation, a hypothetical illustration of past data, not a forecast and not advice for everyone your age. A retiree puts $500,000 into each fund at the Dec 31, 2020 close, spends every distribution and never adds or sells shares. Prices and distributions: Exent market data (SCHD split‑adjusted).
| SCHD | VYM | DGRO | VIG | |
|---|---|---|---|---|
| Shares bought | 23,386 at $21.38 | 5,464 at $91.51 | 11,156 at $44.82 | 3,542 at $141.17 |
| Income in 2021 | $17,537 | $16,917 | $11,956 | $9,422 |
| Income in 2025 | $24,500 | $19,128 | $16,183 | $12,602 |
| Total income 2021–2025 | $105,987 | $91,909 | $71,301 | $55,882 |
| Value on Dec 31, 2025 | $641,487 | $784,177 | $774,431 | $778,423 |
| Income + value | $747,475 | $876,086 | $845,732 | $834,305 |
Arithmetic for SCHD: $500,000 ÷ $21.38 = 23,386 shares; 23,386 × $1.0476 paid in 2025 = $24,500; 23,386 × $27.43 = $641,487; $641,487 + $105,987 = $747,475. SCHD delivered the most income and the fastest income growth (+40% from 2021 to 2025) but the smallest total, because its price rose least. Its strong 2026 so far narrows that gap, which is the point: the ranking depends on the window, while the trade‑off between income and growth stays.
The common mistake is yield chasing: choosing the highest current yield and judging the fund by its income alone. The worked example shows why that misleads, and dividends are not extra money on top of the price. Judge any income fund by total return and by whether the income is enough for a withdrawal you can sustain (see ETFs for retirement income, ETF overlap in common pairs and income vs growth).
| Alternative | Expense ratio | 12‑month yield | Holdings | How it differs |
|---|---|---|---|---|
| VOO / VTI (S&P 500 / total market) | 0.03% | 1.06% / 1.05% | 505 / 3,519 | Whole market; lower yield, no sector tilt; spend by selling shares. |
| HDV (iShares Core High Dividend) | 0.08% | 3.05% | 74 | Concentrated high‑yield screen; even fewer stocks than SCHD. |
| NOBL (S&P 500 Dividend Aristocrats) | 0.35% | 2.17% | 71 | 25+ years of increases, equal‑weighted; much higher fee. |
| CGDV (Capital Group Dividend Value) | 0.33% | 1.23% | 52 | Actively managed; higher fee, manager risk. |
| JEPI (equity premium income) | 0.35% | 8.15% | 140 | Option income, mostly taxed as ordinary income; capped upside. |
Expense ratios and holdings from the issuers (Sep 30–Oct 23, 2026); yields are trailing 12‑month distributions divided by the Sep 30, 2026 price (Exent market data).
Ten years is one market cycle and favored large US growth companies; a different decade could rank these funds differently. Yields are trailing 12‑month payouts, not SEC yields, and move with prices. Dividend growth uses only two calendar years as end points. Sector weights mix classification systems. Taxes depend on your income and state; this is not tax advice.
Dividend funds lean on a few sectors, so a rough patch in energy, staples or banks can hit one fund far harder than the market. Over the 15 years to June 30, 2026, 90.49% of actively managed US large-cap funds underperformed the S&P 500 (S&P DJI, SPIVA). Market intel adds context; it does not pick your ETFs, tell you when to trade or guarantee better results.
For income now, SCHD yields 3.24% against 1.56% for VIG (trailing 12 months to Sep 30, 2026). Both raised payouts about 9.15% a year from 2020 to 2025, and VIG returned more over 10 years to Sep 30, 2026 (12.86% vs 12.44% a year, NAV), so VIG fits growth of income and SCHD fits current income.
Neither is better in general. SCHD yields more (3.24% vs 2.37%) and grew its dividend faster (9.15% vs 3.79% a year), VYM returned more over calendar 2021–2025 (12.7% vs 8.9% a year, Exent calculation), SCHD more over 10 years to Sep 30, 2026 (12.44% vs 11.28%, NAV), and VYM is far more diversified with 593 stocks.
Of these four, SCHD and VIG grew distributions fastest, about 9.15% a year from calendar 2020 to 2025 (Exent calculation from Exent market data). DGRO grew 7.11% and VYM 3.79%.
Most dividends from US stock funds like SCHD are qualified if you meet the IRS holding period of more than 60 days in the 121-day window around the ex-dividend date. Qualified dividends are taxed at 0%, 15% or 20%.
Not over the last decade. Over 10 years to Sep 30, 2026, SCHD, VYM, DGRO and VIG returned 11.28% to 13.16% a year against 15.18% for SPY (issuer NAV, dividends reinvested).
It does a different job. DGRO holds 391 dividend growers and returned 13.16% a year over 10 years (NAV), but yields 1.98% against 3.24% for SCHD.
Yes, and they complement each other: SCHD leans to staples, health care and energy, VIG to technology and financials. If you also own an S&P 500 fund, note that VIG moves most like it (0.96 correlation of calendar-year returns with SPY, 2015–2025, Exent calculation).
Qualified dividends are already taxed at low rates, so dividend ETFs are less costly in a taxable account than bonds. Inside a Roth IRA the dividends are never taxed, so the choice comes down to what else needs the tax-sheltered space.
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Educational content, not investment advice. Examples are illustrative; past performance does not guarantee future results.