What distinguishes the investment approaches of DVY and VYM?

DVY tracks the Mid-Cap Value category, focusing on smaller, potentially more volatile companies, while VYM concentrates on Large Value stocks, typically offering greater stability. This fundamental difference in market capitalisation means DVY might experience higher risk and reward fluctuations compared to VYM's more established, blue-chip-oriented holdings. Investors should weigh their tolerance for volatility against potential growth opportunities.

How do the expense ratios of DVY and VYM impact long-term returns?

DVY charges an expense ratio of 0.38%, whereas VYM is significantly cheaper at 0.04%. This 0.34 percentage point annual difference may seem small but compounds over time. For example, a 10-year investment could see a cumulative fee drag of approximately 3.4% for DVY versus 0.4% for VYM, reducing final returns. Lower costs generally enhance net performance unless outweighed by superior returns.

What does the higher dividend yield of DVY imply compared to VYM?

DVY's 3.40% yield exceeds VYM's 2.31%, indicating DVY distributions per unit of investment are higher relative to price. This suggests DVY holds companies with higher payout ratios, often typical of income-focused strategies. Investors must consider this yield is a historical measure and can vary; the higher figure reflects the fund's specific dividend selection criteria, not necessarily future payments.

How do the fund histories of DVY and VYM differ, and why might this matter?

DVY, launched in November 2003, has a longer operational track record than VYM, which started in November 2006. This 3-year difference provides more historical data for DVY, which could offer insights into its performance across varied market cycles. A longer history aids analysis but doesn't guarantee future results; both funds are sufficiently established for general assessment.

Which fund offers greater scale, and what does that mean for investors?

VYM, with $80.9 billion in net assets, is significantly larger than DVY's $23.1 billion. This substantial size difference means VYM likely offers superior liquidity for institutional and retail traders, with potentially tighter bid-ask spreads. Larger AUM can also enhance market efficiency, reducing transaction costs when buying or selling shares compared to a smaller fund.

What does the lack of sector weights information for both funds imply for analysis?

Since sector weights are not available for DVY and VYM, investors must rely on top holdings to infer sector concentration. For instance, VYM's top holdings like AVGO (Technology) and JPM (Financials) suggest broad diversification, while DVY's HPQ and PFE (both Technology and Healthcare) indicate a more focused approach. This limitation necessitates deeper research or using alternative tools to understand sector risk.

Are there any common stocks between DVY's and VYM's top holdings?

There are no overlapping stocks between the top holdings listed for DVY and VYM. DVY's top 10 includes HPQ, PFE, PRU, and MO, while VYM features AVGO, JPM, XOM, and JNJ. This absence of overlap reinforces their distinct focus: DVY targets mid-cap value companies with higher yields, and VYM selects large-cap value stocks with a broader diversification approach.

What does a lower expense ratio mean for VYM compared to DVY over multiple decades?

VYM's 0.04% expense ratio is 0.34 percentage points lower than DVY's 0.38%. Over 30 years, this difference compounds. On a $10,000 initial investment growing at 7% annually before fees, VYM would accumulate approximately $44,500 more than DVY solely due to the fee gap, assuming identical returns before costs.

Why is the dividend yield difference between DVY and VYM significant for income-focused investors?

DVY's 3.40% yield vs VYM's 2.31% represents a 1.09 percentage point difference. For a $10,000 investment, this equates to $109 more in annual dividends from DVY, assuming yields remain constant. This higher income stream may appeal to those seeking immediate cash flow, but must be weighed against DVY's higher fees and potential risk from mid-cap exposure.

How should beginners approach interpreting the comparison data provided?

Beginners should start by comparing core metrics: fees (VYM's 0.04% is significantly lower than DVY's 0.38%), size (VYM is $80.9bn vs DVY's $23.1bn), and yield (DVY's 3.40% > VYM's 2.31%). The category difference (Mid-Cap Value vs Large Value) and lack of index tracking details add complexity. Prioritise fees and scale for long-term investing, while considering yield for income needs.

DVY vs VYM

Two funds, one decision: we compare cost, performance and what each ETF actually holds in September 2026.

Compare DVY (iShares Select Dividend ETF) and VYM (Vanguard High Dividend Yield ETF) on fees, holdings, dividends and how each tracks its market. DVY yields 3.40% at a 0.38% expense ratio, while VYM yields 2.31% at 0.04%. See which aligns with your goals. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

DVY

Metric

VYM

0.38%

Expense Ratio

0.04%

3.40%

Dividend Yield

2.31%

$23.05B

Net Assets

$80.88B

104

Holdings

613

Nov 3, 2003

Inception Date

Nov 10, 2006

–

Index Tracked

–

Mid-Cap Value

Fund Category

Large Value

VYM costs about $34.00 less per year for every $10,000 invested.

Shared Top Holdings

These funds do not share any of their top holdings.

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Investment Analysis

DVY

Pros

Holds a substantial net asset base of $23.1 billion, enhancing liquidity for institutional traders.
Offers a dividend yield of 3.40 percent, which is significantly higher than the peer alternative.
Established in November 2003, providing a longer operational history than the competing fund.

Considerations

Charges a higher expense ratio of 0.38 percent, increasing the drag on long term returns.
Tracks the Mid-Cap Value category, potentially exposing investors to smaller company volatility risks.
Classified as Mid-Cap Value without available index tracking details, reducing transparency for analysts.

VYM

Pros

Maintains a low expense ratio of 0.04 percent, minimising ongoing management costs for investors.
Boasts net assets of $80.9 billion, offering superior scale and liquidity compared to the peer.
Focuses on Large Value stocks, potentially providing greater stability than mid-cap oriented strategies.

Considerations

Delivers a dividend yield of 2.31 percent, which is lower than the higher yielding competitor.
Inception date is November 2006, offering a shorter operational track record than the peer fund.
Index tracking methodology is not available, limiting clarity on how the large value selection is made.

About DVY and VYM

DVY (DVY)

The iShares Select Dividend ETF (DVY) is an exchange-traded fund designed to provide investors with exposure to a portfolio of dividend-paying US equities. Classified within the Mid-Cap Value category, this fund holds approximately 104 companies, focusing on those with a history of consistent dividends. With an expense ratio of 0.38% and net assets of USD 23.05 billion, it offers a relatively accessible entry point for income-focused strategies. The fund currently reports a dividend yield of 3.40%. Launched in November 2003, DVY has established a long track record in the market. Investors should note that while dividends can provide income, the value of the fund and its distributions can fluctuate. As with any investment, past performance is not indicative of future results, and it is important to consider the inherent risks associated with equity markets.

VYM (VYM)

The Vanguard High Dividend Yield ETF is designed to provide investors with exposure to a broad range of high-dividend-paying stocks listed in the US. With a low expense ratio of 0.04% and over 600 holdings, the fund aims to deliver income while maintaining diversification. Its dividend yield sits at 2.31%, reflecting its focus on companies with strong payout traditions. This ETF suits those seeking a steady income stream as part of a long-term strategy, though values can rise and fall. Returns are not guaranteed. Always consider your personal circumstances before investing.

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DVY vs VYM

Fund Snapshot