Affordable Index Fund Offering Dividends with Minimal Thought, Currently Available Below $500
The Fidelity High Dividend ETF (FDVV) is a popular choice for investors seeking a balance between growth and income. With a minimum investment of $500, you could get nine shares of this exchange-traded fund (ETF).
The Fidelity High Dividend ETF is developed and managed by Fidelity Investments, a well-established asset management company. The ETF trades like a stock and aims to invest at least 80% of its assets in the same ones in the Fidelity High Dividend Index.
The ETF's top 10 holdings collectively make up about 33% of its total value. These include tech giants like Nvidia, Microsoft, Apple, and Broadcom, as well as blue-chip dividend payers such as JPMorgan Chase, Philip Morris International, Visa, ABN AMRO Bank N.V., Coca-Cola, and ExxonMobil. This diversified portfolio suggests that the fund can keep up with the S&P 500 while paying more in dividends.
As of Aug. 1, 2025, the ETF's price per share was about $54. The ETF's recent dividend yield is more than twice that of the S&P 500, offering investors a higher income potential. The ETF's recent yield stands at 3.1%, while the S&P 500's recent yield is 1.2%.
Over the past three years, the Fidelity High Dividend ETF has delivered an average annual return of 15.41%. Compared to the Vanguard S&P 500 ETF (VOO), which has a 5-year average annual return of 15.45%, the Fidelity High Dividend ETF's performance is competitive. However, its higher dividend yield makes it an attractive choice for income-focused investors.
The Fidelity High Dividend ETF's data is sourced from Morningstar.com, while the data for its top holdings is sourced from Fidelity.com.
Investing in the Fidelity High Dividend ETF could be a strategic move for those seeking a balance between growth and income. With its diversified portfolio and high dividend yield, this ETF offers a compelling opportunity for investors looking to boost their returns.
It's important to note that while dividend investing can be powerful, with an average annual total return of 10.24% for dividend growers and initiators from 1973-2024 (according to a Hartford Funds report), it carries risks. Companies typically need to grow to a certain size with reliable income before committing to paying a regular dividend.
In conclusion, the Fidelity High Dividend ETF is a solid choice for investors seeking a balance between growth and income. Its competitive returns, diversified portfolio, and high dividend yield make it an attractive option for those looking to boost their returns while maintaining a steady income stream.
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