VYM vs DGRO: Which ETF Should You Buy for 2026?

"This ETF focuses on stocks that have a record of consistently growing their dividends, hence "DGRO". The thesis is that by investing in growing dividends, your investments can snowball in the long run. This is a proven strategy for those investors who aren't shaken off by market crashes and simply want an income vehicle they can hold and reinvest into."

"DGRO is up 55.6% over the past 5 years, but it yields 2.04% in dividends with a 0.08% expense ratio. Dividends have grown at 7.11% annually over the past 5 years. Thus, the dividend yield is nearly twice as big as the S&P 500, with a dividend growth rate just 2% higher. While that may look like pocket change today, those small numbers can add up over time and make DGRO a strong contender."

DGRO focuses on stocks with a record of consistently growing dividends and targets long-term compounding of income. DGRO returned 55.6% over five years, yields 2.04%, and has a 0.08% expense ratio. DGRO's dividends grew at 7.11% annually over five years. Financials make up 21.13% and healthcare 17.71% of DGRO holdings. VYM tracks the FTSE High Dividend Yield Index and prioritizes stocks with higher current dividend yields for income and long-term equity appreciation. VYM emphasizes current yield rather than dividend growth. Expense ratios, yield focus, and sector composition represent the primary trade-offs between DGRO and VYM for income investors.

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