Dividend ETF Inflows Top $6 Billion in June

State Street Investment Management strategist Matt Bartolini wrote in a monthly research update that investors put more than $6 billion into dividend exchange-traded funds in June. He noted dividend strategies helped push smart beta flows into net inflows for the month.

Bartolini wrote that demand reflects investors seeking income as inflation rises, particularly those at or near retirement. He added that active funds have been pressuring some smart beta products while dividend ETFs drew attention for their income focus.

Examples of dividend ETFs cited in the update include Vanguard High Dividend Yield ETF (VYM), launched in 2006, and Schwab U.S. Dividend Equity ETF (SCHD), launched in 2011. The newest fund discussed is Franklin Templeton’s Franklin U.S. Dividend Booster Index ETF (XUDV), introduced in 2025. XUDV tracks the VettaFi New Frontier US Dividend Select Index and seeks to select and weight securities from 500 large-cap U.S. companies to maximize yield while capping individual stock weights at 5% and sector weights at 30%.

Performance and income metrics vary across the three funds. ETF Database shows XUDV returned 21.4% year-to-date and Franklin Templeton reported a 3.4% distribution rate for the fund as of July 1; XUDV’s expense ratio is 0.09%. Vanguard reports VYM returned 11.6% year-to-date, with a 30-day SEC yield of 2.23% as of May 31 and an expense ratio of 0.04%. Schwab reports SCHD returned 18% year-to-date, with a 30-day SEC yield of 3.35% as of June 30 and an expense ratio of 0.06%.

VettaFi serves as the index provider for XUDV and receives an index licensing fee; VettaFi is not the issuer or sponsor of the ETF.

Bartolini wrote: “Investors want income right now as inflation rises, especially those at or near retirement.”