The DGRO ETF takes a different approach compared to yield-focused funds like SCHD and VYM. Instead of chasing high yields, it screens specifically for dividend growth. To get included in DGRO, companies have to pass two main tests. First, they need a history of at least five consecutive years of dividend growth. Second, their payout ratio has to be 75% or less. This weeds out companies that might be at risk of cutting their dividends. The fund also excludes REITs and the top 10% highest-yielding stocks. Microsoft is their top holding right now. It has a payout ratio of just 14% and over two decades of dividend increases, leaving plenty of room for future growth. The fund yields less than 2%, but it has averaged a 12.2% annualized return since it started in 2014. Long-term data shows that companies consistently growing their dividends usually outperform the broader market.