The Vanguard Australian Shares Index ETF (ASX: VAS) is the most popular exchange-traded fund (ETF) on the ASX. And by a mile too. Investors seem to love the whole-market exposure that this fund from Vanguard provides.
Covering the whole ASX (well, the top 300 companies on the ASX) gives investors in this ETF many advantages. You have massive diversification, with capital spread across 300 individual companies).
There's also the comfort of knowing that you'll get the market's rate of return, no more, no less. And the Vanguard Australian Shares ETF's management fee of 0.1% is relatively low for an exchange-traded fund by ASX standards.
But what of dividend income? Can investors in this ETF expect some healthy cash flow as well from this investment?
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How often does the Vanguard Australian Shares ETF pay dividends?
Well, the answer is yes. The Vanguard Australian Shares ETF does indeed pay out dividend distributions to its investors. And regularly so.
Any ETF that owns a dividend-paying share has to pass on the income received to its investors. So Vanguard's massive portfolio of dividend payers is a big advantage here.
On the ASX, it is the norm to pay out dividends bi-annually, or every six months. But this fund takes this a step further. Investors in this ETF typically enjoy a dividend distribution every three months. Paying out income quarterly is obviously an advantage for lovers of dividend income, so no doubt this is appreciated by investors.
Let's see what this looks like in practice.
So the Vanguard Australian Shares ETF has indeed paid out four dividend distribution payments over the past 12 months. The latest of these came just last month, a payment of $1.45 per unit, covering the three months to 30 September 2022.
Before that, we had a $2.16 per unit distribution, a $2 per unit distribution and a 6965 cents per unit payment.
That all adds up to a trailing annual total of approximately $6.30 per unit.
On today's Vanguard Australian Shares ETF pricing of $86.43 (at the time of writing), this gives the fund a trailing distribution yield of 7.29%.
