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May 1, 2024 · Average annual returns include changes in price and reinvestments of dividends and capital gains. Since-inception returns for less than 1 year and year-to-date returns aren't annualized. Index performance is provided as a benchmark but isn't illustrative of any particular investment.
- Overview
- How Do Mutual Funds Pay Dividends?
- Vanguard High Dividend Yield Index Admiral Shares (VHYA
- Vanguard Dividend Appreciation Index Admiral Shares (VDAD
- Columbia Dividend Opportunity Fund (INUT
- Vanguard Dividend Growth Fund (VDIG
- Rowe Price Dividend Growth Fund (PRDG
- Federated Strategic Value Dividend Fund (SVAA
- Vanguard Equity Income Fund Investor Shares (VEIP
- Neuberger Berman Equity Income Fund (NBHA
Reinvestment is known to increase long-term returns. When you
your money, the interim income you generate is put back into the investment. But some investors opt to receive periodic payments from their investments, depending on their specific needs. Periodic
, which are debt instruments, and regular
, which are cash payments from
, can offer investors a steady stream of income. In this article, we explore eight of the best dividend mutual funds that regularly pay dividends regularly.
Many mutual funds offer aggregate dividends from multiple stocks that are either reinvested or paid out to account holders.
Mutual funds often contain a basket of securities including
or stocks, which may pay dividends. Dividends are paid to shareholders at different times. For instance, mutual funds that follow a
reinvest the received dividend amount back into the stocks. Other funds follow the dividend payment plan by continuing to aggregate dividend income over a monthly, quarterly, or sometimes six-month period, then making a periodic dividend payment to account holders.
A fund pays income after expenses. If a fund gets a regular yield from the dividend-paying constituent stocks, those expenses can be covered fully or partially by
Depending on local laws, dividend income may be tax-free, which can add to an investor’s overall return.
Investors should also note that companies are not obliged to make dividend payments on their stocks, meaning that dividends are not guaranteed. Investors looking for dividend income may find
Vanguard's High Dividend Yield Index Admiral Shares is an
that attempts to replicate the performance of the FTSE High Dividend Yield Index. This index contains stocks of companies that usually pay higher-than-expected or greater-than-average dividends. Being an index fund, VHYAX replicates the benchmark stock constituents in the same proportion. This fund has maintained a consistent history of paying
dividends since its inception on Feb. 7, 2019.
Being an index fund, the VHYAX has one of the lowest
—0.08%, as of Feb. 27, 2023—and its SEC yield was 3.06%, as of July 31, 2023. The fund has a $3,000 minimum investment requirement. It may be a perfect low-cost fund for anyone looking for higher-than-average dividend income.
For investors looking for a lower minimum investment requirement, Vanguard offers this fund as an
The VDADX is an index fund, which attempts to replicate the performance of the benchmark Nasdaq US Dividend Achievers Select Index. This unique index consists of stocks that have been increasing their dividend payouts over time. Being an index fund, the VDADX replicates the benchmark stock constituents in the same proportion. This fund is also a consistent payer of quarterly dividends since its inception date of Dec. 19, 2013.
VDADX also has one of the lowest expense ratios. Like VHYAX, it only charges 0.08% as an expense ratio with an SEC yield of 1.76%, as of July 31, 2023. The fund has a $3,000 minimum investment requirement.
Columbia Threadneedle Investments’ Dividend Opportunity Fund focuses on delivering dividends by investing in the stocks of companies that have historically paid consistent and increasing dividends. The fund offers a diversified
for both U.S. and foreign securities of various-sized companies.
The Vanguard Dividend Growth Fund primarily invests in a diversified portfolio of
) U.S. and global companies that are
relative to the market and have the potential for paying dividends regularly. The fund research attempts to identify companies that have high earnings growth potential leading to more income, as well as the willingness of company management to increase dividend payouts.
VDIGX has an expense ratio of 0.30% and an SEC yield of 1.58%, as of July 31, 2023. The fund’s inception date was May 15, 1992, and it has a $3,000 minimum investment requirement.
Any fund that invests in stocks, bonds, or other securities can realize gains in losses due to the price movements of the holdings. Although the market gains can lead to enhanced
in addition to the SEC yield, market losses can also occur. These losses can be so significant that not only can the SEC yield be wiped out, but a loss of the initial investment is also possible.
Based on the principle that increasing dividends over a period are positive indicators of a company’s financial health and growth, the T. Rowe Price Dividend Growth Fund looks to invest mostly in stocks of large companies, with some midsized companies folded into the mix. The fund seeks companies that have a strong track record of paying dividends or that are expected to increase their dividends over time.
PRDGX contains mostly stocks of large U.S. companies that pay quarterly dividends. It has an expense ratio of 0.64%. The fund’s inception date was Dec. 30, 1992, and it has a $2,500 minimum initial investment requirement.
For investors who are not satisfied with quarterly dividends, the Strategic Value Dividend Fund from Federated Hermes offers monthly dividends. The fund’s investment strategy includes generating income and long-term
by focusing on higher-dividend-paying stocks than that of the broader equity market. The fund also seeks out companies with dividend growth potential, and the fund is primarily benchmarked to the Dow Jones U.S. Select Dividend Index.
The Vanguard Equity Income Fund Investor Shares focuses primarily on established U.S. companies that are consistent dividend payers. The fund’s holdings tend to be slow-growth but high-yield companies. As a result, the stock price gains may be limited compared with other funds.
VEIPX pays regular quarterly dividends and has an inception date of March 21, 1988. The fund has an expense ratio of 0.28% and an SEC yield of 2.62%, as of July 31, 2023. The fund requires a minimum investment of $3,000.
The Neuberger Berman Equity Income Fund looks to earn dividend income and capital appreciation by investing in high-dividend-paying equities that include common stocks, utilities,
real estate investment trusts (REITs)
, convertible securities such as bonds, and derivative instruments like
The fund’s inception date was June 9, 2008. It has a $1,000 minimum initial investment requirement. It pays dividends with an SEC yield of 2.22%, as of June 30, 2023, and has an expense ratio of 0.71%.
Jul 5, 2024 · Mutual funds that own dividend-paying or interest-bearing securities pass those to investors in the fund. Dividends are the investor's part of a company’s profits.
6 days ago · The performance data shown in tables and graphs on this page is calculated in USD of the fund/index/average (as applicable), on a Bid To Bid / Nav to Nav basis, with gross dividends...
- Open Ended Investment Company
- Moderately Conservative Allocation
- Market Cap: LargeInvestment Style: Blend
FILL's dividend yield, history, payout ratio & much more! Dividend.com: The #1 Source For Dividend Investing.
- 0.73%
- 98.07%
- 1.21%
Expense ratio is the fund’s total annual operating expenses, including management fees, distribution fees, and other expenses, expressed as a percentage of average net assets. Watchlist. POLAR CAPITAL INTERNATIONAL SMALL COMPANY FUND. PCSCX | Fund. $9.65. 0.00%. 4.01%. Snapshot. Vitals.
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Dividend Data. Stock Data. Avg Price Recovery. N/A. Best dividend capture stocks in Oct. Payout Ratio (FWD) Fwd Payout Ratio is used to examine if a company’s earnings can support the current dividend payment amount. It divides the Forward Annualized Dividend by FY1 EPS. Click here to learn more. N/A. Years of Dividend Increase.
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