Wealthy PotVIG vs VYM: Vanguard's Dividend Growth vs High Yield
VIG and VYM are Vanguard's two flagship dividend ETFs, both dirt-cheap at 0.04%, but they pursue opposite ideas. VIG holds companies that consistently grow their dividends; VYM holds stocks with high current yield. That difference shows up in how much income you collect and how the funds tilt. This guide uses figures pulled straight from Vanguard's fund documents.
The Short Answer
- Want higher current dividend income and a value tilt? VYM. It holds ~605 higher-yielding stocks and pays a bigger dividend today (~2.2% vs ~1.4%).
- Want quality companies that grow their dividends, with more total-return orientation? VIG. It holds ~332 dividend growers, yields less now, but has a quality tilt many long-term investors prefer.
Same issuer, same 0.04% fee, opposite dividend philosophies. Pick by whether you want income now (VYM) or dividend growth and quality (VIG).
Growth of Dividends vs Yield Today
- VIG is the Vanguard Dividend Appreciation ETF. It tracks the S&P U.S. Dividend Growers Index, companies with a record of raising dividends year after year, and it deliberately screens out the very highest yielders (which can signal stress). The result is a quality tilt, ~332 holdings, and a lower current yield.
- VYM is the Vanguard High Dividend Yield ETF. It tracks the FTSE High Dividend Yield Index, stocks forecast to pay above-average yields (excluding REITs), giving a broader ~605-stock, value-tilted basket with a higher current yield.
VIG vs VYM Side by Side
| Feature | VIG | VYM |
|---|---|---|
| Fund | Vanguard Dividend Appreciation | Vanguard High Dividend Yield |
| Index tracked | S&P U.S. Dividend Growers | FTSE High Dividend Yield |
| Strategy | Dividend growth (quality) | High current yield (value) |
| Expense ratio | 0.04% | 0.04% |
| Number of holdings | ~332 | ~605 |
| SEC 30-day yield | ~1.43% | ~2.20% |
| 10-year return (avg annual, NAV) | 10.90% | 11.78% |
| Growth of $10,000 over those 10 years (hypothetical) | $28,140 | $30,450 |
Over the past decade VYM's higher-yielding, value-tilted basket slightly out-returned VIG on a total-return basis, but the two trade the lead depending on whether value or quality-growth is in favor. Neither is permanently better; they express different tilts.
Which One Fits You
Choose VYM if: you want more dividend income now and a broader, value-tilted portfolio. It's the higher-yield pick, popular with income-focused investors. For a higher-yielding, quality-screened alternative, compare VYM vs SCHD.
Choose VIG if: you prefer quality companies with a track record of raising dividends, are comfortable with a lower current yield, and value the screen that avoids the riskiest high-yielders. It leans more toward total return and stability. Comparing it to Schwab's popular fund? See VIG vs SCHD. Some investors hold both VIG and VYM for a blend of growth and income.
FAQ
Is VIG or VYM better?
They target different dividend goals. VYM holds ~605 higher-yielding stocks and pays more income now (~2.2% vs ~1.4%); VIG holds ~332 dividend growers with a quality tilt and lower yield. Both cost 0.04%. Income investors often prefer VYM; those wanting quality dividend growth prefer VIG.
Why does VYM yield more than VIG?
VYM's index selects for high current yield, while VIG's index selects for a history of dividend growth and deliberately excludes the highest yielders. So VYM's ~2.2% SEC yield sits above VIG's ~1.4%.
Which has performed better, VIG or VYM?
Over the past decade VYM's total return slightly edged VIG's, helped by value's periods of strength. But the two trade the lead across cycles, and quality-growth (VIG) leads in other environments. Past performance doesn't predict the future.
Should I own both VIG and VYM?
You can, VIG adds dividend-growth quality while VYM adds current income and value exposure. They overlap on some large dividend payers, so holding both blends the two tilts rather than doubling a single strategy.
Related comparisons: VYM vs SCHD · VIG vs SCHD · DGRO vs SCHD · SCHD vs VOO · All ETF comparisons
Primary sources: expense ratios, indexes, holdings, yields, and returns are from Vanguard's official fund fact sheets for VIG and VYM, figures as of Jun 30, 2026 (SEC 30-day yields as of Aug 31, 2026). For background, see the SEC's Investor.gov guide to mutual funds and ETFs.
This article is for educational purposes only and is not investment advice. Investing involves risk, including possible loss of principal, and past performance does not guarantee future results. Dividends are not guaranteed and can be cut. Expense ratios, yields, and holdings change over time; confirm current figures on Vanguard's site before investing. Consult a qualified financial professional before making investment decisions.