VIG vs. DGRO: Navigating Tariff Turbulence with the Sharpest Dividend ETF

As trade wars loom and recession risks climb, dividend ETFs are the lifeboats investors need to weather the storm. But not all dividend ETFs are created equal. Today, we dissect the Vanguard Dividend Appreciation ETF (VIG) and the Invesco Dividend Achievers ETF (DGRO)—two giants of the income space—to determine which holds the edge in a tariff-troubled market.

The Yield Edge: DGRO's 0.41% Advantage Matters

Let's start with cold, hard math. DGRO currently offers a dividend yield of 2.3%, while VIG trails at 1.7%. That 0.41% spread might seem small, but over time, it compounds into meaningful income. For a $100,000 portfolio, DGRO generates $2,300 annually versus VIG's $1,700—a $600 boost every year.

This edge isn't luck. DGRO's broader portfolio—400+ holdings vs. VIG's 300—gives it deeper exposure to defensive sectors like utilities (15% of DGRO's portfolio) and healthcare (14%), which historically thrive in slow-growth environments. VIG, by contrast, leans heavier into consumer discretionary stocks (18%), which face pressure as tariffs hike costs and consumers tighten budgets.

The Stability Test: DGRO's 5-Year Dividend Discipline

DGRO's secret weapon? A 5-year dividend growth requirement—longer than VIG's 10-year streak criteria. This means DGRO only holds companies that consistently boost payouts, not just those with a decade-old track record. Since 2014, this focus on proven dividend growers has powered DGRO to outperform VIG by 2.1% annually, with half the volatility during the 2018-2019 trade war.

Recession Proofing: Why a -35% Drawdown Beats -47%

Goldman Sachs now assigns a 45% chance of recession by mid-2025—a stark warning. How would these ETFs fare?

• DGRO's max drawdown since 2008: -35%
• VIG's max drawdown: -47%

The difference? DGRO's sector diversification shields it from overexposure to cyclical sectors. Utilities and healthcare held firm during past downturns, while consumer discretionary stocks cratered. Even in a mild recession, DGRO's broader net catches more stable cash flows.

The Bottom Line: DGRO Wins on Yield, Diversification, and Resilience

• Income: DGRO's 2.3% yield beats VIG's 1.7% in a low-yield world.
• Risk: Its -35% max drawdown is 26% shallower than VIG's.
• Future-Proofing: 400+ holdings spread risk across utilities, healthcare, and tech—sectors insulated from trade wars.

This isn't just about today's yield—it's about surviving the next downturn with income intact.

Call to Action: Shift to DGRO Before the Tariffs Bite Deeper

If you're holding VIG, it's time to pivot. DGRO's 0.41% yield edge, sector diversity, and recession resilience make it the smarter choice in a market where tariffs and recession risks are escalating.

Don't wait for the next sell-off. Deploy capital now to lock in DGRO's superior income and stability. The next tariff announcement—or recession signal—could erase months of gains.

Act now. Protect your dividends. Choose DGRO.