# BlackRock's HDV is crushing Vanguard's VYM

> A smaller, more focused dividend ETF from BlackRock has outperformed the market favorite by nearly 9 points in 2026.
- Title: BlackRock's HDV is crushing Vanguard's VYM · 24/7 Wall St.
- Summary: A smaller, more focused dividend ETF from BlackRock has outperformed the market favorite by nearly 9 points in 2026. HDV's concentrated bet on quality…
- Keywords: etf, dividend investing, vym, hdv, blackrock, vanguard, high dividend yield, performance comparison, expense ratio, portfolio strategy, BlackRock's, crushing
- Source: 24/7 Wall St. — https://247wallst.com/investing/etf/2026/09/18/forget-vym-blackrocks-high-dividend-fund-is-beating-it-by-9-points-yields-more-and-charges-0-08
- Author: Ryne Mauck
- Published: 2026-09-18T21:35:04+00:00
- Read time: 2 min
- Topics: etf, dividend investing, vym, hdv, blackrock, vanguard, high dividend yield, performance comparison, expense ratio, portfolio strategy
## VYM's reign is being challenged
Vanguard's VYM has been the go-to dividend ETF for years, holding 500 stocks with broad exposure. But in 2026, BlackRock's smaller HDV fund has quietly pulled far ahead.
## The performance gap is massive
From January 2 through September 3, 2026, VYM returned 15.29% while HDV returned 23.85%. That's an 8.56-point gap in just eight months, in the same asset class.

> From January 2, 2026 through September 3, 2026, VYM returned 15.29% on a total-return basis. Over the same window, HDV returned 23.85%.
## HDV uses a completely different approach
HDV screens for companies with strong economic moats and financial health, then ranks by dividend yield. This creates a 75-stock portfolio tilted toward energy, healthcare, and staples.
## The yield gap is substantial
HDV's 30-day SEC yield is 3.34% versus VYM's 2.20%. On a $50,000 position, that's roughly $1,670 in annual distributions from HDV versus $1,100 from VYM.
## But VYM has a fee advantage
Vanguard cut VYM's expense ratio to 0.04% in 2026, half of HDV's 0.08%. Over decades, that four-basis-point gap compounds, though HDV's returns currently swamp this advantage.
## HDV carries concentration risk
With roughly 75 holdings versus VYM's 500-plus, HDV is far more concentrated. If energy or healthcare rolls over, HDV will fall harder than VYM would.
## The style tilt cuts both ways
HDV's quality and yield screen has helped in a year rewarding defensives. But in a growth-led year, HDV could trail VYM by a similar margin. This is a deliberate factor bet.
## Tax matters if you switch
In a tax-advantaged account, swapping is simple. In a taxable account, check your cost basis first. A large unrealized gain could trigger capital gains that erase years of HDV's income edge.
## Choose based on your goal
Want diversified, low-cost market-like dividend exposure? VYM is still right. Want income plus quality with a defensive tilt? HDV is the better choice, with more concentration risk.
## Key takeaway

HDV's concentrated bet on quality dividend payers and defensive sectors has beaten VYM's broad approach by 8.56 points year-to-date, though it comes with higher concentration risk and slightly higher fees.