S&P 500 Offers Record Dividends In Q2: How To Tap With ETFs?

Investors should also note that a company which consistently increases its dividend has stronger fundamentals, suggesting rising cash flows, good liquidity and a strong balance sheet.

How to Play

Given this, investors could tap growing dividends in the form of ETFs. Below, we have highlighted five popular dividend ETFs that offer excellent dividend growth potential, any of which could be a solid pick for investor in the long term: 

Vanguard Dividend Appreciation ETF (VIG - Free Report)

This is the largest and most popular ETF in the dividend space with AUM of $27.8 billion and average daily volume of about 797,000 shares. The fund follows the NASDAQ US Dividend Achievers Select Index, which is composed of high-quality stocks that have a record of raising dividend every year. It holds 182 securities in the basket, with none accounting for more than 4.3% share. The fund charges 8 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

iShares Select Dividend ETF (DVY - Free Report)

This fund provides exposure to the high dividend-paying U.S. equities with a 5-year history of dividend growth. It follows the Dow Jones U.S. Select Dividend Index and holds 99 securities in its basket with each accounting for less than 2.4% of assets. The ETF has AUM of $17.1 billion and average daily volume of more than 716,000 shares. It charges 39 bps in fees per year from investors and has a Zacks ETF Rank #3 with a Medium risk outlook.

SPDR S&P Dividend ETF (SDY - Free Report)

With AUM of $15.6 billion and average daily volume of 548,000 shares, this fund provides a well-diversified exposure to 112 U.S. stocks that have been consistently increasing their dividends every year for at least 20 years. This can be done by tracking the S&P High Yield Dividend Aristocrats Index. Each firm accounts for less than 2.3% of assets. The fund charges 35 bps in fees and has a Zacks ETF Rank #3 with a Medium risk outlook.

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