BTO vs VYM
John Hancock Financial Opportunities Fund vs Vanguard High Dividend Yield ETF
Quick Verdict
VYM has a lower expense ratio. VYM delivered stronger 1-year returns. VYM offers more diversification with 616 holdings.
Side-by-Side Comparison
| Metric | BTO | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 2.96% | 0.04% | |
| AUM | $709M | $81.6B | |
| Dividend Yield | 6.18% | 2.24% | |
| Holdings | 184 | 616 | |
| YTD Return | +17.11% | +15.34% | |
| 1Y Return | +19.55% | +23.24% | |
| 3Y Return (annualized) | +24.15% | +19.22% | |
| 5Y Return (annualized) | +5.83% | +12.21% | |
| Volatility (annualized) | 31.1% | 14.6% | |
| Max Drawdown | -95.5% | -58.8% | |
| Fund Family | John Hancock Investment Management | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Aug 18, 1994 | Nov 10, 2006 |
BTO vs VYM Performance
John Hancock Financial Opportunities Fund (BTO) is a ETF from John Hancock Investment Management and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year BTO returned +19.55% while VYM returned +23.24%. Year to date, BTO is up 17.11% versus a gain of 15.34% for VYM.
Over three years, BTO compounded at +24.15% per year against +19.22% for VYM; over five years the annualized figures are +5.83% and +12.21% respectively. Across the full 20-year window we track, VYM has the edge at +7.04% annualized vs -4.15%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
BTO has been the more volatile fund, with annualized monthly volatility of 31.1% compared with 14.6% for VYM. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -95.5% for BTO and -58.8% for VYM. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.66. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
BTO charges 2.96% per year while VYM charges 0.04%. On a $10,000 position that is $296 vs $4 annually, a gap of $292 per year that compounds over a long holding period. On income, BTO currently yields 6.18% against 2.24% for VYM.
Holdings Overlap
BTO and VYM share 36 holdings out of 701 unique holdings combined, representing a 2.1% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, BTO or VYM?
BTO has an expense ratio of 2.96% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $292 per year of difference.
Which performed better, BTO or VYM?
Over the past year BTO returned +19.55% vs +23.24% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), BTO annualized -4.15% vs +7.04% for VYM. Past performance does not guarantee future results.
Which is riskier, BTO or VYM?
BTO has been the more volatile fund at 31.1% annualized versus 14.6% for VYM. Worst drawdown: BTO -95.5% vs VYM -58.8%.
Should I hold both BTO and VYM?
BTO and VYM have a monthly-return correlation of 0.66, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between BTO and VYM?
BTO and VYM share 36 common holdings with a 2.1% weight overlap. Combined, they hold 701 unique securities.
Which pays a higher dividend, BTO or VYM?
BTO yields 6.18% while VYM yields 2.24%, so BTO currently pays the higher dividend yield.
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