What’s VDY stock?
VDY is one of the most popular Canadian dividend ETFs. It provides instant exposure to a high quality portfolio of high dividend paying stocks. In this post, we will be going over VDY’s objective, strategy, volatility and performance. We will also compare VDY stock with its rival ETFs.
VDY is Canadian dividend ETF. It invests exclusively in the Canadian stock market. VDY’s objective is to replicate the performance of the FTSE Canada High Dividend Yield Index, which consists of Canadian stocks having a high dividend yield.
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What is FTSE High Dividend Yield Index?
FTSE is a world leader in the creation and management of indexes. The high dividend yield index follows the steps show below:
- Select companies part of the borad Canadian equity index also called FTSE Canada Index;
- Gather data on the 12 months forward dividend yield using I/B/E/S (Institutional Brokers’ Estimate System managed by Thomson Reuters)
- Exclude all stocks that pay or forecasted to pay in the next 12 months 0 regular dividend;
- Establish a ranking and screens periodically for liquidity.
Is VDY a good investment?
VDY stock vs XDV and XEI
In this section, we will compare VDY with Both XDV – Ishares Canadian Select Div Index and XEI – Ishares S&P TSX Comp High Div Index. See tables below:
Table 1: AUM and MER
| ETF | AUM* | MER* |
| XDV – Ishares Canadian Select Div Index | 1,734 | 0.55 |
| XEI – Ishares S&P TSX Comp High Div Index | 1,088 | 0.22 |
| VDY – Vanguard FTSE CDN High Div Yld Index | 1,137 | 0.21 |
Looking at the management fees, VDY is attractive. The MER is only 0.21% in comparison with XDV, which stands at 0.55%.
Table 2: VDY Stock – Performance comparison and analysis
Updated every 15 minutes – VDY Stock
VDY has the best long term performance in both the 3 and 5 years span.
In terms of allocation, the banking sector dominates both VDY and XEI holdings. It’s essential to keep this in mind when constructing your portfolio. In essence, you want your overall holdings to be diversified across various sectors.
XDV holds 30 high dividend-paying stocks in its holdings while VDY 39. In terms of volatility, XDV and VDY have the same volatility (Beta: 0.9). Since VDY offers a better performance, it’s clear it’s a better choice than XDV.
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Table 3: Dividend schedule and Beta
| ETF | Monthly Div | Beta* |
| XDV | Yes | 0.9 |
| XEI | Yes | 1.1 |
| VDY | Yes | 0.9 |
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VDY Stock Morningstar rating
The Morningstar rating for VDY is 5 stars:
How much is the dividend for VDY?
VDY pays dividends on a monthly basis. Please refer the last column of the table below for the amount of dividend distribution.
| Amount | Dividend Type | Ex-Div Date | Record Date | Pay Date | Declare Date |
|---|---|---|---|---|---|
| 0.1946 | Regular | 1/31/2024 | 2/1/2024 | 2/8/2024 | 1/25/2024 |
| 0.1672 | Regular | 12/28/2023 | 12/29/2023 | 1/8/2024 | 12/20/2023 |
| 0.1625 | Regular | 11/30/2023 | 12/1/2023 | 12/8/2023 | 11/23/2023 |
| 0.1522 | Regular | 10/31/2023 | 11/1/2023 | 11/8/2023 | 10/24/2023 |
| 0.1772 | Regular | 9/28/2023 | 10/2/2023 | 10/10/2023 | 9/22/2023 |
What Holdings are in VDY?
| Holding Name | % of Market Value |
|---|---|
| Royal Bank of Canada | 13.86% |
| Toronto-Dominion Bank | 12.62% |
| Enbridge Inc. | 7.46% |
| Bank of Nova Scotia | 7.45% |
| Bank of Montreal | 6.63% |
| Canadian Imperial Bank of Commerce | 4.80% |
| Canadian Natural Resources Ltd. | 4.67% |
| TC Energy Corp. | 4.51% |
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VDY Sectors allocation
| Sector | Fund |
|---|---|
| Financials | 57.1% |
| Energy | 26.3% |
| Telecommunications | 7.8% |
| Utilities | 5.9% |
| Consumer Discretionary | 1.7% |
