Dividend ETFs have attracted a big following as investors seek refuge from the high market volatility.

For instance, the Vanguard Dividend Appreciation Index ETF (NYSEArca: VIG) holds high quality companies that have the ability and commitment to increase their dividends over time. The fund focuses on companies that have increased their annual regular dividends for at least the past 10 consecutive years. VIG has an expense ratio of 0.18%. [ETF Spotlight: Vanguard Dividend Appreciation]

“Investors seeking stability and a growing income stream may want to consider VIG,” writes Stuart J. Benway, S&P Capital IQ Equity Analyst, in a research note. “The Dividend Achievers are typically companies with strong cash reserves, solid balance sheets and a proven record of consistent earnings growth, in our view.”

Consequently, S&P Capital IQ gives an “overweight” rank for VIG, based on risk considerations, low cost, quality rank and credit rating inputs.

VIG has a yield of about 2%, whereas the average stock dividend yield in the S&P 500 is about 2.4%.

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