As we discussed earlier this week, the Vanguard MSCI Index International Shares ETF (ASX: VGS) is one of the most popular exchange-traded funds (ETFs) on the share market today. According to data from CommSec, VGS is currently the sixth-most popular ETF on the ASX boards. As well as the second-most popular ETF that invests outside the ASX.
As it stands today, this Vanguard International Shares ETF has more than $4.3 billion in funds under management (FUM).
In addition to being one of the most popular ETFs on the ASX boards, VGS is also one of the most diversified. If you think the ASX’s most popular fund – the Vanguard Australian Shares Index ETF (ASX: VAS) – is diversified with its 300 or so holdings, this will knock your socks off.
As it stands today, VGS is currently invested in more than 1,500 different underlying companies, spread across more than 20 countries. Its largest weighting is by far to the United States, which commands almost 70% of this ETF’s underlying portfolio. But other advanced economies also have a meaningful presence. These include Japan, the United Kingdom, Canada, Singapore, New Zealand and a range of European countries.
Earlier this week, we covered VGS’s performance, which has been a lot better than the ASX’s over the past decade or so. Vanguard’s ASX 300 VAS ETF has averaged a return of 10.99% over annum over the past five years. In contrast, VGS has managed 15.96% per annum over the same period.
But how does VGS fare when it comes to paying out income, something that many ASX investors are perpetually interested in?
What kind of dividend income does VGS provide?
Like most Vanguard ETFs, VGS pays out a quarterly dividend distribution ito its investors. It’s last four distributions were as follows:
- 40.34 cents per unit for the quarter ending 31 December 2020
- 31.56 cents per unit for the quarter ending 31 March 2021
- 81.3 cents per unit for the quarter ending 30 June 2021
- 34.26 cents per unit for the quarter ending 30 September 2021
That adds up to a trailing annual distribution of $1.87 per unit.
On today’s present VGS unit price of $105.28, that gives VGS a trailing yield of 1.78%.
Although VGS doesn’t hold the kinds of income-spewing ASX shares at its top as VAS does, it still holds a number of formidable dividend payers in its largest holdings. These include Apple Inc (NASDAQ: AAPL), Microsoft Corporation (NASDAQ: MSFT), Johnson & Johnson (NYSE: JNJ) and Exxon Mobil Corp (NYSE: XOM).
The Vanguard MSCI Index International Shares ETF charges an annual management fee of 0.18%.