The Vanguard Australian Shares Index ETF (ASX: VAS) is a popular exchange-traded fund (ETF) on the ASX. It's so widely held, in fact, that VAS has long held the title of the most popular ETF and index fund on the ASX by funds under management for a number of years.
As such, there will be many ASX investors who will be receiving a paycheque today. That's because it's dividend payday for the Vanguard Australian Shares ETF this Tuesday.
The Vanguard Australian Shares ETF typically pays quarterly dividend distributions rather than the six-month interval that is common on the ASX.
We first got an idea about what the latest VAS dividend distribution would be late last month. Back on 28 June, Vanguard announced that the latest investor payment for this ETF would be worth 67.21 cents per unit – an amount later confirmed on 1 July.
That was the same day that VAS units traded ex-dividend on the ASX. So if you didn't own this ETF at the end of trading on 30 June, you won't be eligible to receive this latest dividend distribution.
But for those lucky investors who did make the cut, today is your lucky day.
If you haven't already received this cash payment, you will see 67.21 cents for every VAS unit owned arrive sometime today. Like most VAS dividends, this payment will come partially franked, reflecting the mixed nature of its underlying holdings.
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VAS' latest ASX dividend goes low
However, this payment might not be as enthusiastically welcomed as some of VAS's former ASX dividend distributions. That's because this 67.21 cents per unit payment is well below what VAS's ASX investors would be used to.
For one, it pales in comparison to this ETF's last three quarterly dividend distributions. The quarter ending 31 March saw investors bag 84.79 cents per unit, for example. Before that, investors enjoyed payments worth 71.62 cents and $1.29 per unit, respectively.
2024's June quarter distribution is even smaller than the payment investors received this time last year. 2023's June distribution came to 88.9 cents per share. So this year's paycheque is in effect a 24.4% pay cut from last year.
But there's not a lot Vanguard could have done about that. Like all ETFs, VAS can only pass on what it receives in dividend income from its underlying holdings. So the fact that this month's distribution is so low is more of a reflection of the dividends it has enjoyed from its top holdings, like the big four banks, BHP Group Ltd (ASX: BHP), CSL Ltd (ASX: CSL), and Wesfarmers Ltd (ASX: WES).
But saying that, the passive income from an ASX index fund like VAS is usually quite volatile. So long-term investors would be used to their dividend distributions coming in ebbs and flows.
This latest dividend distribution from VAS takes this ASX ETF's annual distribution total to $3.52 per unit. At the current VAS unit price of $99.06 (at the time of writing), this gives the Vanguard Australian Shares Index ETF a dividend yield of 3.55%.
