“Can I build a steady cash flow from stocks?”
“Is there a way to receive income from the market like a pension?”
If you’re asking questions like these, VYM is an ETF you should definitely explore.
VYM (Vanguard High Dividend Yield ETF) is one of the most trusted and popular high-dividend ETFs focused on stable, income-generating U.S. companies.
In this post, we’ll dive into VYM’s structure, strengths and risks, top holdings,
and how it compares with similar ETFs like SCHD and JEPI.
What is VYM?
VYM stands for the Vanguard High Dividend Yield ETF.
It invests in a broad range of high-dividend-paying U.S. companies,
offering both income stability and broad diversification.
Key Facts
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ETF Name: Vanguard High Dividend Yield ETF (VYM)
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Issuer: Vanguard
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Index Tracked: FTSE High Dividend Yield Index
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Inception Date: November 10, 2006
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Expense Ratio: 0.06% (very low)
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AUM: Over $60 billion
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Dividend Frequency: Quarterly
Top Holdings (as of 2024)
| Company | Sector | Note |
|---|---|---|
| Johnson & Johnson | Healthcare | Dividend aristocrat |
| JPMorgan Chase | Financials | Leading U.S. bank |
| Exxon Mobil | Energy | High dividend + oil prices |
| Procter & Gamble | Consumer Staples | Reliable dividend payer |
| Chevron | Energy | Top U.S. oil company |
| Home Depot | Consumer Discretionary | Retail & growth |
👉 VYM includes 400+ stocks, offering both sector balance and income diversity.
Advantages of VYM
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Stable dividend income
Yield hovers around 3%, even during economic downturns. -
Ultra-low fees (0.06%)
Great for long-term compounding with minimal cost. -
Blue-chip focused
Strong fundamentals, brand power, and steady cash flow. -
Ideal for dividend beginners
Offers exposure to U.S. dividend stocks without picking individual names.
Risks & Considerations
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Lower exposure to growth stocks
Not ideal for those seeking tech-driven capital appreciation. -
Slower dividend growth
Unlike SCHD or VIG, VYM doesn’t focus on increasing dividends over time. -
Sensitive to interest rate shifts
Rising rates can make dividend ETFs less attractive. -
Sector bias
Heavy allocations to financials and energy during some cycles.
VYM vs SCHD vs JEPI Comparison
| Feature | VYM | SCHD | JEPI |
|---|---|---|---|
| Dividend Focus | High yield stocks | Dividend growth + quality | Monthly income + options overlay |
| Avg Yield | ~2.8–3.2% | ~3–3.5% | ~7–10% |
| Volatility | Low | Low–Moderate | Very Low |
| Holdings Count | 400+ stocks | ~100 stocks | ~120 stocks |
| Expense Ratio | 0.06% | 0.06% | 0.35% |
👉 VYM = Traditional high-yield exposure
👉 SCHD = Growth + dividend focus
👉 JEPI = Stable monthly income with lower risk
Who Should Consider VYM?
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Investors seeking consistent dividend income
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Those interested in U.S. large-cap value stocks
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Anyone wanting to reduce portfolio volatility
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Long-term investors building a retirement or income strategy
Final Thoughts: VYM – A Steady Performer for Dividend Seekers
The VYM ETF delivers a simple yet powerful strategy:
✅ Low fees
✅ Broad diversification
✅ Stable income
If you’re starting to explore dividend investing or want to build a foundation for long-term cash flow,
VYM is an excellent place to start.
📌 Compared to SCHD or JEPI, VYM offers a back-to-basics, reliable dividend strategy
that suits many income-focused portfolios.
This post is not a buy or sell recommendation, but an introduction to the ETF/stock.
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