TD Dividend Growth Fund Review: Returns, Dividends & Fees

The TD Dividend Growth Fund promises income and growth in one package, but its 2% management fee and 2025 underperformance versus the TSX put that promise to the test. Does active management by TD Asset Management justify the cost for Canadian retirees building an income portfolio?

Fund Category: Canadian Dividend & Income Equity ·
Net Asset Value (Dec 2025): $270.57 million ·
1-Year Return (Series A, 2025): 18.4%

What is the TD Dividend Growth Fund?

What is the investment objective?

The TD Dividend Growth Fund aims to provide a high level of after-tax income and steady growth by investing primarily in high-quality, high-yield equity securities of Canadian corporations. The fund may also hold foreign equities, income trusts, and other income-producing securities to diversify its sources of return (MD Dividend Growth Fund 2025 Annual Report).

Which stocks does the fund invest in?

• The fund focuses on dividend-paying Canadian companies across sectors like Financials, Materials, and Energy (MD Annual Report).
• At the end of 2025, Financials and Materials were key contributors to performance (MD Annual Report).
• It maintains a small allocation (about 2.9%) to non-Canadian equities to capture global dividend opportunities (MD Annual Report).

The implication: the fund’s sector tilt ties its fate to the health of Canada’s financial and commodity industries. Those are cyclical, and the fund’s conservative dividend focus can both protect and constrain.

What are the different series (A, I, D, O)?

• Series A (TDB756): Standard retail class with a 2.00% management fee, often available through discount brokers.
• Series I (TDB972): Lower-cost series for institutional or high-net-worth investors, with a lower management fee.
• Series D: For discount brokerage platforms, typically with a lower fee than Series A.
• Series O: Fee-based series designed for advisor-managed accounts, with a reduced base fee.

The trade-off: lower fees mean higher net returns for the same gross performance, but Series I and O require higher minimum investments.

Which Mutual Fund Gives a 12% Return?

Is the TD Dividend Growth Fund a high-return fund?

In 2025, the fund’s Series A returned 18.4% (MD Annual Report). Historical returns fluctuate widely: 9.4% (2024), -6.8% (2023), 19.9% (2022), -1.8% (2021), 23.9% (2020). No mutual fund — including this one — can guarantee a fixed return of 12% per year. The fund’s objective is steady growth and income, not chasing the highest short-term numbers.

What are the 1-year returns for this fund?

For Series A, the 2025 return is 18.4% (MD Annual Report). For comparison, the Morningstar Canada Dividend Growth Index gained 20.62% over the 12 months to Dec 31, 2025, and the Morningstar Canada Dividend Yield Focus Index gained 28.80% (Morningstar).

How do its returns compare to the category average?

The fund underperformed the broad S&P/TSX Capped Composite Index in 2025, largely because it lacked exposure to metals and mining stocks and held conservative dividend-paying names that lagged the market rally (MD Annual Report). The catch: when the market rotates back to value and dividends, this fund tends to shine.

How Often Are TD Dividends Paid?

Does the TD Dividend Growth Fund pay dividends?

Yes, the fund typically distributes dividends quarterly (Morningstar). The exact amount varies because it depends on the dividends received from underlying holdings and any realized capital gains.

What is the dividend history for this fund?

The fund has a long history of quarterly distributions, but rates are not fixed. For example, distributions in 2025 came from a portfolio of companies like TD Bank (C$4.32 annual dividend, 3.34% yield) and Power Corporation (C$2.45 annual, 3.36% yield) (Morningstar).

When are ex-dividend dates for this fund?

Ex-dividend dates are set by the fund manager and announced in advance. Typically, the fund goes ex-dividend in March, June, September, and December, with payments following within a few weeks.

How Much Money Do I Need to Make $1000 a Month in Dividends?

What is the current dividend yield of the TD Dividend Growth Fund?

The fund’s yield fluctuates with market price and dividend amounts. The underlying holdings’ average yield is around 3.5–4% based on the stocks it owns (Morningstar). Using a 4% yield assumption, generating $1,000 per month ($12,000 per year) requires $300,000 invested.

How do I calculate principal needed for a target dividend income?

The formula is simple: divide your annual income target by the expected yield. For a 4% yield, $1,000/month needs $12,000 / 0.04 = $300,000. Using a 3% yield, the requirement rises to $400,000.

What is a realistic dividend growth rate assumption?

Canadian dividend aristocrats typically grow their payouts 5–10% per year. Over time, the fund’s dividend per unit can increase, which means the principal needed today may be lower if you allow dividend growth to raise your income. The catch: market volatility and company-specific risk mean you should plan for a range, not a single number.

What is the Highest Paying Dividend Fund?

Where does the TD Dividend Growth Fund rank by yield?

It is not designed to be the highest-yielding fund. Its focus is on dividend growth and total return. Higher-yield funds often take more risk or use leverage. For reference, the Middlefield Real Estate Dividend Class achieved a FundGrade A+ rating in 2025 with an 11.9% one-year return but targets real estate income (Middlefield Press Release).

What are the risks of high-yield dividend funds?

• High yields can signal distressed companies or risky sectors.
• Capital appreciation may be sacrificed for income.
• Dividends are not guaranteed and can be cut.

How can I compare dividend funds?

Look at total return (not just yield), management expense ratio (MER), portfolio quality, and dividend growth history. The table below compares the TD Dividend Growth Fund to popular Canadian dividend ETFs.

Three funds, one contrast: the TD Dividend Growth Fund charges a higher MER but offers active management, while the ETFs track indexes with lower costs.

Source: Million Dollar Journey (ETF data), MD Annual Report (fund data).

The trade-off: lower fees from ETFs mean more money stays in your pocket if performance is similar. Active management can add value in volatile or selective markets.

Upsides and Downsides

Confirmed facts and what remains unclear

Confirmed facts:

• The fund’s investment objective is to provide high after-tax income and steady growth (MD Annual Report).
• Net asset value grew 16% in 2025 to $270.57 million (MD Annual Report).
• Series A return for 2025: 18.4% (MD Annual Report).
• Dividends are paid quarterly (Morningstar).

What remains unclear:

• Future dividend rates and total returns depend on market conditions.
• Whether active management will continue to outperform net of fees.
• The impact of rising ETF popularity on fund flows and performance.

“The fund seeks high consistent income and long-term capital appreciation via high-quality dividend-producing preferred and common shares of Canadian corporations.”

— MD Dividend Growth Fund annual report, TD Asset Management

“Dividend stocks have long been a core holding for income-focused investors, but the key is selecting companies with sustainable payout ratios and growth potential.”

— Morningstar analyst commentary

The TD Dividend Growth Fund offers a straightforward proposition: regular quarterly income with a side of long-term growth. Its 2.00% management fee on Series A eats into returns, and its 2025 underperformance against the TSX raises a question — is active management worth the premium?

For the Canadian retiree building an income portfolio, the choice is clear: if you value hands-on stock selection and are comfortable with a fee premium, this fund can anchor your dividends. If you prefer lower costs and index tracking, an ETF like XDIV or CDZ gives you a cheaper path to similar dividend exposure.

Related reading: Exchange-Traded Fund – What It Is, How It Works and Investing · Royal Bank Stock TSX – Price, Dividend and Performance Guide

For a detailed breakdown of the fund’s holdings and historical returns, see this TD Dividend Growth Fund review.

Frequently Asked Questions