Here's How Many Shares of the Vanguard High Dividend Yield ETF (VYM) You'd Need for $500 in Yearly Dividends
Key Points
The Vanguard High Dividend Yield ETF offers a current yield of 2.5%.
VYM delivers a steady income stream by focusing on large, reliable companies with above-average dividend yields.
The fund could be a good conservative choice for investors seeking income without taking on excessive risk.
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The Vanguard High Dividend Yield ETF (NYSEMKT: VYM) is a popular dividend-focused exchange-traded fund for investors seeking a high income stream. Its focus on large, well-established companies that offer above-average dividend yields can be an ideal strategy for those looking to improve what they earn from their portfolios.
As of Dec. 4, 2025, the Vanguard High Dividend Yield ETF offers an annualized yield of 2.5%. At its current share price of $145.17, that works out to roughly $3.59 in annual dividends per share earned for every share owned. If an investor were looking to earn $500 in dividends annually from their investment in this fund, they would need to own approximately 140 shares. Do the math and that comes out to about $20,360 invested in order to earn those $500 in dividends (assuming that yield and share price).
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This ETF can be attractive to income seekers because of its conservative approach to high-yield investing. The fund's index considers a company's estimated dividends over the next 12 months and then chooses the top 50% by forecasted dividend yield. Real estate investment trusts (REITs) are excluded. Qualifying components are weighted by market capitalization.
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This strategy helps to ensure strong diversification in the portfolio and an overreliance on high yields that are due to poor recent stock performance or unsustainable dividend payouts.
The Vanguard High Dividend Yield ETF falls into Morningstar's Large Cap Value category. The ETF holds 566 stocks (as of Oct. 31) and carries an ultra-low 0.06% expense ratio. Its top five sector holdings include financials (21.1%), technology (14.1%), industrials (13.5%), healthcare (12.3%), and consumer discretionary (9.8%). Top individual holdings include Broadcom, JPMorgan Chase, and ExxonMobil.
While VYM's yield and composition will change over time, it remains a solid option for investors looking to add an above-average yield to their portfolio without taking on excessive risk.
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JPMorgan Chase is an advertising partner of Motley Fool Money. David Dierking has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends JPMorgan Chase and Vanguard Whitehall Funds - Vanguard High Dividend Yield ETF. The Motley Fool recommends Broadcom. The Motley Fool has a disclosure policy.
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