When thinking about Mutual Funds, one of the first companies that comes to mind for me is Vanguard. Vanguard has a reputation as being one of the best mutual fund companies in the business, and provides quality funds, with low cost fees, meaning you keep more of your earnings. Vanguard also offers certain trades that offer no service fees, or no upfront costs. When trading Vanguard ETFs (Exchange Traded Funds), Vanguard charges no transactions fees on this, and little if any commission.
The Vanguard Dividend Appreciation fund comes in both a standard mutual fund, and an ETF. Overall, the funds are pretty similar, but the main differences between the two funds is that an ETF is traded more like a regular stock, while the regular mutual fund, is traded like a typical mutual fund. The Vanguard Dividend Appreciation mutual fund has a minimum deposit of $3000, while the ETF has no minimum purchase amount, and is traded like a stock, in terms of its share price changes constantly, etc. I prefer the ETF, because it allows me to trade the fund easier, and make quick transactions, of any amount. The symbol for the Vanguard Dividend Appreciation ETF is VIG.
The fund features some of the market’s best dividend stocks, with some of its top holdings including strong companies, such as Pepsi, McDonalds, Chevron, Coca Cola, IBM, Proctor and Gamble, Wal-Mart, Johnson and Johnson, and more. The overall mission of the fund is to provide performance of the Dividend Achievers Index. The criteria for the fund is that the stock must continue to increase their dividend over the long term (10 years or so), in order to make sure that shareholders of the mutual fund or ETF are provided with the highest qualities dividends possible. What is great about this ETF or mutual fund is, that even the market is down, the companies it holds are also blue-chip, strong companies, as that’s who can afford to pay out the best dividends. Even in times of economic uncertainty, the mutual fund and ETF performs better than the S&P 500, with lower losses, and generally higher gains.
Overall, this is one of my favorite funds, and is currently one that I own. Before purchasing, it’s important to do your own research, so you know what you are investing in. It’s also important to check and see if you’re interested in the mutual fund version, or the ETF, as the ETF may also be a higher risk.