Vanguard Dividend Growth Mutual Fund
The Vanguard Dividend Growth Fund (VDIGX) has a great long-term track record, posting an annual return of nearly 8% a year since its inception in 1992, with an even more impressive 10-year return of 9.5% annually between 2003 and present day.
The fund is your quintessential low-risk, large-cap income fund with 20% allocated in healthcare and 13% in consumer staples to provide stable performance over the long-term in addition to great yield. Top stocks right now include McDonald’s (MCD), Johnson & Johnson (JNJ), Microsoft (MSFT) and Walmart (WMT).
While VDIGX’s holdings might not generate huge income — with the current yield measuring about 2.1% — the distributions are very stable, and the overall stability thanks to these megacap components is very enviable for low-risk investors.
And if you worry about things getting rocky for amid a cooling housing market and the debt ceiling debacle, then this low-risk fund has a lot of appeal beyond just its dividend yield.
Portfolio manager Don Kilbride is a top-notch value investor and has been running the fund with great success since 2006. And with a rock-bottom expense ratio of 0.29%, investors are charged just $29 annually for every $10,000 invested to tap into Kilbride’s know-how.