Vanguard has closed one of its most popular dividend mutual funds to new investors after it reached $30 billion, writes Erin E. Arvedlund for Philly.com.

The Vanguard Dividend Growth Fund’s current investors will still be able to put money in, but new investors are out of luck for now.

The rapid growth of the fund is yet another sign that dividend-paying stocks have become the new bonds. Billions of dollars have been pouring into dividend funds like Vanguard Dividend Growth, run by portfolio manager Donald Kilbride.

Kilbride has been running the Vanguard Dividend Growth Fund for a decade. He has beaten the performance of 97 percent of rival funds over that period by looking for companies that have the potential to increase their dividends.

“The reason to buy Dividend Growth is Kilbride,” commented Daniel Wiener, editor of Independent Adviser for Vanguard Investors. He added that slowing down cash flows if they are overwhelming the manager is always a good policy, something Vanguard often does if the managers request it.  

Kilbride has said on several occasions, that current yield is less important to him than the prospect for future dividend increases.

“When I talk to investors, I try to get the conversation away from current yield. I’m thinking about a stock’s future yield over the next five years,” said Kilbride recently in an interview.

Vanguard recommends that investors interested in the closed fund should consider investing in the Vanguard Dividend Appreciation Index Fund with net assets of $26.2 billion.

Read more about the fund at Philly.com here, and check out previous VISTA Today coverage of Vanguard here.