DFEM vs VTI
Dimensional Emerging Markets Core Equity 2 ETF vs Vanguard Total Stock Market ETF
Quick Verdict
VTI has a lower expense ratio. DFEM delivered stronger 1-year returns. DFEM offers more diversification with 6316 holdings.
Side-by-Side Comparison
| Metric | DFEM | VTI | Winner |
|---|---|---|---|
| Expense Ratio | 0.39% | 0.03% | |
| AUM | $8.9B | $663.5B | |
| Dividend Yield | 1.85% | 1.07% | |
| Holdings | 6,512 | 3,543 | |
| YTD Return | +18.51% | +14.22% | |
| 1Y Return | +32.08% | +22.19% | |
| 3Y Return (annualized) | +21.46% | +21.27% | |
| 5Y Return (annualized) | - | +12.23% | |
| Volatility (annualized) | 17.5% | 15.3% | |
| Max Drawdown | -20.8% | -56.6% | |
| Fund Family | Dimensional | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Apr 26, 2022 | May 24, 2001 |
DFEM vs VTI Performance
Dimensional Emerging Markets Core Equity 2 ETF (DFEM) is a ETF from Dimensional and Vanguard Total Stock Market ETF (VTI) is a ETF from Vanguard (US). Over the past year DFEM returned +32.08% while VTI returned +22.19%. Year to date, DFEM is up 18.51% versus a gain of 14.22% for VTI.
Over three years, DFEM compounded at +21.46% per year against +21.27% for VTI. Across the full 4-year window we track, DFEM has the edge at +14.01% annualized vs +8.14%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
DFEM has been the more volatile fund, with annualized monthly volatility of 17.5% compared with 15.3% for VTI. 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 -20.8% for DFEM and -56.6% for VTI. 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 0.69. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
DFEM charges 0.39% per year while VTI charges 0.03%. On a $10,000 position that is $39 vs $3 annually, a gap of $36 per year that compounds over a long holding period. On income, DFEM currently yields 1.85% against 1.07% for VTI.
Holdings Overlap
DFEM and VTI share 6 holdings out of 9093 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, DFEM or VTI?
DFEM has an expense ratio of 0.39% while VTI charges 0.03%. VTI is the cheaper option. On a $10,000 investment, that is $36 per year of difference.
Which performed better, DFEM or VTI?
Over the past year DFEM returned +32.08% vs +22.19% for VTI, so DFEM leads on 1-year performance. Over the longest common window we track (4 years), DFEM annualized +14.01% vs +8.14% for VTI. Past performance does not guarantee future results.
Which is riskier, DFEM or VTI?
DFEM has been the more volatile fund at 17.5% annualized versus 15.3% for VTI. Worst drawdown: DFEM -20.8% vs VTI -56.6%.
Should I hold both DFEM and VTI?
DFEM and VTI have a monthly-return correlation of 0.69, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between DFEM and VTI?
DFEM and VTI share 6 common holdings with a 0.0% weight overlap. Combined, they hold 9093 unique securities.
Which pays a higher dividend, DFEM or VTI?
DFEM yields 1.85% while VTI yields 1.07%, so DFEM currently pays the higher dividend yield.
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