FAZ vs VYM
Direxion Daily Financial Bear 3X ETF 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 | FAZ | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 1.03% | 0.04% | |
| AUM | $84M | $81.6B | |
| Dividend Yield | 2.54% | 2.24% | |
| Holdings | 8 | 616 | |
| YTD Return | -16.30% | +15.75% | |
| 1Y Return | -26.41% | +23.85% | |
| 3Y Return (annualized) | -42.92% | +19.14% | |
| 5Y Return (annualized) | -31.54% | +12.45% | |
| Volatility (annualized) | 53.4% | 14.6% | |
| Max Drawdown | -100.0% | -58.8% | |
| Fund Family | Direxion Shares ETF Trust | Vanguard (US) | |
| Category | Alternative | Equity | |
| Inception | Nov 6, 2008 | Nov 10, 2006 |
FAZ vs VYM Performance
Direxion Daily Financial Bear 3X ETF (FAZ) is a ETF from Direxion Shares ETF Trust and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year FAZ returned -26.41% while VYM returned +23.85%. Year to date, FAZ is down 16.30% versus a gain of 15.75% for VYM.
Over three years, FAZ compounded at -42.92% per year against +19.14% for VYM; over five years the annualized figures are -31.54% and +12.45% respectively. Across the full 18-year window we track, VYM has the edge at +7.06% annualized vs -52.79%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
FAZ has been the more volatile fund, with annualized monthly volatility of 53.4% 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 -100.0% for FAZ 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 -0.83. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FAZ charges 1.03% per year while VYM charges 0.04%. On a $10,000 position that is $103 vs $4 annually, a gap of $99 per year that compounds over a long holding period. On income, FAZ currently yields 2.54% against 2.24% for VYM.
Holdings Overlap
FAZ and VYM share 0 holdings out of 606 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, FAZ or VYM?
FAZ has an expense ratio of 1.03% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $99 per year of difference.
Which performed better, FAZ or VYM?
Over the past year FAZ returned -26.41% vs +23.85% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (18 years), FAZ annualized -52.79% vs +7.06% for VYM. Past performance does not guarantee future results.
Which is riskier, FAZ or VYM?
FAZ has been the more volatile fund at 53.4% annualized versus 14.6% for VYM. Worst drawdown: FAZ -100.0% vs VYM -58.8%.
Should I hold both FAZ and VYM?
FAZ and VYM have a monthly-return correlation of -0.83, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FAZ and VYM?
FAZ and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 606 unique securities.
Which pays a higher dividend, FAZ or VYM?
FAZ yields 2.54% while VYM yields 2.24%, so FAZ currently pays the higher dividend yield.
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