Vanguard High Dividend Yield (VYM)

Today shares of Vanguard High Dividend Yield ETF (VYM) entered into what some call “oversold territory”, it traded as low as $58.36. “Oversold” can be defined by looking at the Relative Strength Index (RSI), a technical indicator used to measure momentum. A stock may be considered “oversold” when the RSI reading falls below 30.

In the case of Vanguard High Dividend Yield, the RSI reading hit 29.2. The current RSI reading for the S&P 500 is just above 33.

VYM’s low point in its 52 week range is $52.09 per share, with $62.38 as the 52 week high point

I currently hold ISHARES INC EMERGING MARKETS DIV ETF (DVYE), which is down 9.27% YTD. VYM is down 5.84% YTD, slightly worse than the S&P500 which is down 5.23% YTD. Extending the comparison out to 1yr shows DVYE -21.32%, VYM +11.51%, and the S&P500 +15.76%. The dividend yield for DVYE is 5.06%, while the dividend yield for VYM is 2.98%.

Emerging markets have been getting hammered since the start of 2013, and the trend does not look to be reversing. It may open an opportunity to either add to a stake in DVYE or open a new stake in that fund. VYM, by contrast, has doubled in the last 5yrs, and is up 16% since its inception in 2006. For anyone looking to add a dividend fund to their accounts, VYM is starting to look very appealing at these prices. If the down trend in VYM, and the broader market, continues I will look to add this to my long-term retirement accounts.