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3 Excellent Dividend Stock Funds

These funds are for investors seeking high yields or dividend growth from stocks.

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Russel Kinnel: Hi, I'm Russ Kinnel, director of manager research for Morningstar. Let's talk dividend funds. There are two common dividend strategies. Equity income maximizes yield while moderating risk, if done right. Dividend growth is a large-blend strategy that seeks companies with the potential to grow their dividends. That requires a strong balance sheet and good growth prospects, but it usually means a lower yield than equity income. Either way, be sure to get a fund with low costs because the expense ratio is subtracted from the yield.

If you want a straight-up yield play, consider Vanguard High Dividend Yield Index. It's a Silver-rated index fund with one of the highest yields among large-value Medalists. The fund only charges 8 basis points.

Russel Kinnel does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.