Vanguard’s VIG Dividend ETF’s Top Stock Is… Broadcom? Here’s Why

2 months ago 21

Omor Ibne Ehsan

Wed, July 22, 2026 astatine 10:20 AM CDT 4 min read

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Broadcom (AVGO) tops VIG astatine 5.39% due to the fact that market-cap weighting rewards its 791% five-year summation contempt the fund's dividend-growth branding.
VIG's 1.7% output and 9% year-to-date instrumentality way SCHD, which yields much and has surged astir 22% successful 2026.
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The largest presumption successful Vanguard Dividend Appreciation ETF (NYSEARCA:VIG) is Broadcom (NASDAQ:AVGO), an AI semiconductor institution whose banal has climbed 710% implicit 5 years.

A person's manus successful a acheronian suit holds a metallic pen, pointing astatine an illuminated achromatic upward arrow connected a bluish integer screen. The surface displays assorted fiscal graphics, including candlestick charts successful bluish and red, barroom graphs, and smaller enactment charts. At the apical center, the letters 'E', 'T', and 'F' are separately enclosed successful hexagonal shapes. The inheritance is simply a brushed bluish gradient with bokeh effects.

VIG markets itself arsenic a prime dividend-growth fund, but the mechanics of however it's built person softly turned it into thing with a genuine maturation motor bolted onto the dividend story. If you ain VIG for defensiveness, you should recognize what is really inside.

How a Chip Giant Became a Dividend ETF's Anchor

VIG tracks the S&P U.S. Dividend Growers Index, which screens for companies with 10 oregon much consecutive years of dividend increases, past excludes the apical 25% highest-yielding names arsenic a prime filter, past weights what remains by marketplace capitalization. That last measurement is wherever the astonishment lives. Screen for dividend growers, propulsion retired the output chasers, and market-cap weighting volition interval the mega-caps to the apical nary substance what assemblage they travel from.

Broadcom qualifies easily. It has raised its dividend for 14+ years, presently pays $0.65 quarterly, and carries a marketplace headdress of astir $1.83 trillion. That operation lands it astatine 5.39% of VIG, up of Apple (NASDAQ:AAPL) astatine 4.55% and Microsoft (NASDAQ:MSFT) astatine 4.26%. Technology arsenic a full makes up 25.1% of the fund.

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The motor underneath that apical slot is the AI capex cycle. Broadcom's Q1 fiscal 2026 AI gross deed $8.4 billion, up 106% twelvemonth implicit year, Q2 came successful astatine $10.8 billion, up 143%, and Q3 guidance calls for $16.0 billion. CEO Hock Tan told investors connected the June 20 call, "Broadcom achieved grounds revenue, operating nett and escaped currency travel successful Q2 driven by accelerating maturation successful AI semiconductor gross and beardown operating leverage." That is not the illustration of a antiaircraft holding.

Does VIG Deliver connected the Dividend-Growth Promise?

On distributions, yes. VIG's trailing 12-month payout is $3.58, up from $3.38 successful 2024 and $3.09 successful 2023. The June 2026 quarterly outgo of astir $1.00 is the highest successful the fund's history. Expenses tally 0.04%, which is adjacent to free.

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