Many investors tend to seek bond-linked or high-dividend-targeting investment instruments eyeing a growing uncertainly of the path for the U.S. economy, and many contradicting statements in that respect voiced by a variety of reputable banks and investment funds.

But there is even a more interesting option, allowing investors to not just passively collect stable incoming dividends — like those contributed by the dividend aristocrats, but even grow the value of such dividends in time! The S&P Dividend Growers Index Series measures the performance of companies that have followed a policy of consistently increasing dividends every year for a declared number of years.

The fund's investment strategy is to track the S&P Dividend Growth Index. The index is subject to an indicated annual dividend yield exclusion, with the top 25% highest yield ranked eligible companies from the index universe excluded from index inclusion. Companies classified as part of the Global Industry Classification Standard (GICS) Real Estate Investment Trust Industry (REITs) are excluded. Constituents are float-adjusted market capitalization (FMC) weighted, subject to a single component weight cap of 4%, which is considered a pretty much diversified structure.

The index excludes real estate investment trusts and the top 25% of stocks with the highest yields, and limits participation weighting to 4%. As per consensus estimates, the fund expects DPS (dividend-per-share) growth of 6% during 2024–25. This modest growth rate is due to the fund investing in slower-growing, more mature companies that require less capital outlay. VIG has a dividend yield of 1.95% and paid $3.16 per share in the past year. The dividend is paid every 3 months and the last ex-dividend date was Sep 28, 2023.

Having said all that, this fund may not be the best choice for those looking for higher income. The fund is expected to continue to perform in line with the S&P500, and daily volatility is likely to be lower due to more even holding weights and lower technology exposure. VIG has a consensus rating of Moderate Buy which is based on 209 buy ratings, 96 hold ratings and 11 sell ratings.