In 2025, VIG underperformed a foreign-and-sector-tilted peer largely due to its US-only mandate and sector allocation. The fund’s overweight position in healthcare (15% of assets) failed to offset weakness in other defensive sectors, while its exclusion of REITs removed a source of steady income that benefited other dividend strategies. The lack of exposure to foreign equities also meant missed upside from international bank holdings that drove notable alpha elsewhere last year.

VIG stands out for its ultra-low expense ratio of 0.05%, a fraction of many dividend-growth alternatives. As of December 2025, it managed $120.4 billion in assets under management, reflecting its appeal to both retail and institutional investors seeking broad dividend growth exposure at minimal cost. This low-fee environment supports compound returns over time, particularly when compared to funds charging ten times more in annual fees.

The ETF tracks a broad index of U.S. large-cap companies with a history of growing dividends, currently holding 338 stocks. Its sector weights are tilted toward technology (28%) and financial services (22%), alongside the 15% healthcare allocation. Over the trailing 12 months, VIG delivered a total return of 12.73%. Over five years, a hypothetical $1,000 investment grew to $1,557, though investors experienced a maximum drawdown of 20.39% during that period.

Looking ahead, VIG is positioned to benefit if healthcare equities rebound and interest rates stabilize. The fund’s exclusion of interest-rate-sensitive real estate securities may prove advantageous if REITs underperform in a steady-rate environment. Meanwhile, its heavy weighting in technology and financials could drive further gains should earnings recover in those sectors. Investors focusing on U.S. dividend growth may find VIG’s blend of low cost, diversification and quality dividend histories attractive for next year’s market dynamics.