In short: The FTSE All-World High Dividend Yield index focuses on large and mid-cap companies from developed and emerging markets that pay above-average dividend yields, excluding real estate investment trusts. European investors access this strategy via the Vanguard FTSE All-World High Dividend Yield UCITS ETF (VGWE, VHYL) with ongoing charges of 0.29% annually.
In short
Many investors look for funds that spread broadly across the globe while focusing specifically on companies that pay a dividend. A well-known index used for this purpose is the FTSE All-World High Dividend Yield Index. This page explains how this index is constructed, why the mix of companies differs from a broad global index, and how dividends and returns work together. This is an explanation and strictly not advice or a recommendation.
How the index is built
The index, created by FTSE Russell, is derived from the broad FTSE All-World index. This means the starting point consists of large and mid-sized companies from both developed and emerging markets around the world. From that large pool, a stricter selection is made to arrive at the high-dividend variant.
First, FTSE Russell excludes real estate investment trusts (REITs) and applies dividend eligibility conditions, excluding companies forecast to pay no dividend over the next 12 months. Eligible stocks are then ranked by forecast dividend yield over 12 months; the percentiles are based on market value. A company that is already in the index stays until it falls beyond the 55th percentile; a new company enters if it ranks within the 45th percentile. The index is reviewed in March and September.
Once the companies are selected, they are weighted based on their market value. This means that larger companies carry a heavier weight in the index than smaller companies. The goal is to create a collection of stocks that together offers a higher dividend than the broad global market.
On 31 August 2026 the index held 2,429 stocks (the FTSE All-World 4,264) and the ten largest companies together weighed 11.40% (FTSE Russell index factsheet).
What is in it and what is not
Because the index selects companies on their forecast dividend, its mix of companies differs from the broad FTSE All-World. Companies that pay little or no dividend drop out of the selection or carry less weight.
This different composition does not make the index better or worse than the broader global market. It is simply a different blend of companies. An emphasis on dividends does not automatically protect against a stock market downturn. Prices go up and down, and companies may cut or stop their dividends.
Dividend and total return
When investing, the total return consists of two separate parts: the change in the share price and the dividend you receive. A higher dividend does not mean a higher total return by itself.
It is important to remember that a dividend is part of the total return, and not extra money added on top. When a company pays a dividend, cash leaves the company. On the ex-dividend date (the first day the share trades without the upcoming dividend; you must own it before that day to receive the payment), the share price typically falls by roughly the amount of that dividend.
In addition, the dividend you receive may be taxed. The rules for dividend tax and potential dividend leakage differ by country and by personal situation.
This is general information, not tax or investment advice. For your own situation, consult a qualified tax adviser, a financial adviser licensed by the AFM (the Dutch financial markets authority) or the Belastingdienst.
The funds
A widely used fund that tracks this index is the Vanguard FTSE All-World High Dividend Yield UCITS ETF, which is domiciled in Ireland. There are two main share classes available.
The distributing class, known by the ticker VHYL, pays the collected dividend four times a year to investors. The accumulating class (ticker VGWE in euros or VHYA in dollars) automatically reinvests the dividend back into the value of the fund.
The fund buys the shares itself (physical replication) and holds a representative sample of the index: 2,364 stocks on 31 August 2026, with USD 14,834 million in assets for the whole fund. Launch dates: VHYL on 21 May 2013 and VGWE on 24 September 2019.
For both share classes, the ongoing costs (TER) are exactly the same: 0.29% a year. This percentage is higher than the 0.14% charged by the same issuer for its broad FTSE All-World fund.
| Class | Ticker (EUR) | ISIN | Ongoing costs | Dividend | Check date |
|---|---|---|---|---|---|
| accumulating | VGWE (EUR); VHYA (USD) | IE00BK5BR626 | 0.29% | reinvested | Oct 2026 |
| distributing | VHYL | IE00B8GKDB10 | 0.29% | paid out, 4 times a year | Nov 2026 |
The official documents are on the issuer’s site:
- VGWE: KID, published on Vanguard’s website
- VHYL: KID, published on Vanguard’s website
VHYL’s KID in plain words
Every fund sold to private investors in the EU must publish a Key Information Document (KID): three pages with the costs, the risk and example scenarios, in a fixed format. Below are the figures from VHYL’s KID, each with what it means. We read the document every month and note when something changes on our changes page.
| Figure | What the KID says | What it means |
|---|---|---|
| Ongoing costs | 0.29% a year | Management and running costs, taken from the fund’s value. This is the figure most sites call the TER. |
| Transaction costs | 0.04% a year | The fund’s own costs of buying and selling shares, on top of the 0.29%. Together 0.33% a year. |
| Risk class | 3 out of 7, “a medium-low risk class” | A scale from 1 to 7 based on past price swings. It describes the past; it is not a promise. |
| Recommended holding period | 5 years | The period the KID calculates its scenarios for. You can sell earlier, but the result can then differ more. |
| Warning | “not simple and may be difficult to understand” | The KID says this about the fund itself. It is a reason to read the figures slowly, not a sign that something is wrong. |
| Depositary | “no compensation or guarantee scheme” if the depositary fails | The depositary is the bank that keeps the fund’s assets. The protection of your broker account is a separate matter. |
How the “moderate scenario” moved
The scenarios in a KID are recalculated every month from the past ten years of the fund and its benchmark, so they move with the market even when the fund itself does not change. Between 31 December 2023 and 30 September 2026 the moderate one-year figure for VHYL went from 2.50% to 10.50% a year.
| KID scenarios as at | Moderate, 1 year | Stress, 1 year |
|---|---|---|
| 31 December 2023 | 2.50% | −79.00% |
| 30 June 2024 | 4.30% | −79.00% |
| 31 December 2024 | 6.00% | −79.00% |
| 30 June 2025 | 9.50% | −47.90% |
| 31 December 2025 | 9.90% | −48.00% |
| 30 June 2026 | 10.50% | −48.00% |
| 30 September 2026 | 10.50% | −48.00% |
Read a scenario as “what the recent past would have given”, not as what you will get. The stress figure shows the other side: in the same document, a bad year could mean a large loss.
Sources and check date
The facts on this page are based on the documentation from FTSE Russell and Vanguard, consulted in October 2026. See the sources for links to the factsheets, and the ETF overview for other indexes. More context on fund costs can be found in our article What does an ETF really cost?, and details on taxes are in the FAQ. The index rules come from the ground rules of the FTSE All-World High Dividend Yield Index (February 2026) and the index factsheet (31 August 2026); the fund data from Vanguard’s factsheets (31 August 2026).
With the calculator on this site, you can look at the ongoing costs of VHYL over multiple years. In the tool, you can choose whether to reinvest the dividend or have it paid out as cash. Past performance is no guarantee of future results.
Facts checked on 3 October 2026.
Source of the fund data: the issuers' factsheets and KIDs. Where the data comes from