Dividends4Life: Vanguard and Fidelity Split on Dividend Investing

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Vanguard and Fidelity Split on Dividend Investing

Posted by D4L | Thursday, September 23, 2010 | | 0 comments »

Fidelity Investments and Vanguard Group manage the two largest mutual funds that buy shares of large growth companies with rising dividends, but they couldn't be more different. Fidelity's top picks are technology companies, including Apple(AAPL), Cisco(CSCO) and Hewlett-Packard(HPQ). Vanguard plays it safe with consumer staples such as Pepsi(PEP), Procter & Gamble(PG) and Johnson & Johnson(JNJ).

The $7.2 billion Fidelity Dividend Growth Fund(FDGFX), which holds 538 companies, is tilted toward an improving economy. Its largest industry weighting is technology, at 17.9% of assets, versus the Vanguard Dividend Growth Fund's(VDIGX) 6%. Financial firms comprise 17.6% of the Fidelity fund, compared with 7.5% for Vanguard, which has assets of $3.4 billion. The Vanguard fund, which holds 47 companies and shadows the Dividend Achievers Select Index, has conservative sector allocations, with consumer staples at 17.2% and health care at 16.7%. Still, its biggest position, at 3.6%, is Automatic Data Processing(ADP).

Source: TheStreet.com

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