FCEF vs VYM
First Trust Income Opportunities 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 | FCEF | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 3.69% | 0.04% | |
| AUM | $83M | $81.6B | |
| Dividend Yield | 6.88% | 2.24% | |
| Holdings | 62 | 616 | |
| YTD Return | +10.09% | +15.75% | |
| 1Y Return | +14.73% | +23.85% | |
| 3Y Return (annualized) | +16.17% | +19.14% | |
| 5Y Return (annualized) | +6.20% | +12.45% | |
| Volatility (annualized) | 14.6% | 14.6% | |
| Max Drawdown | -45.1% | -58.8% | |
| Fund Family | First Trust Portfolios (US) | Vanguard (US) | |
| Category | Allocation/Balanced | Equity | |
| Inception | Sep 27, 2016 | Nov 10, 2006 |
FCEF vs VYM Performance
First Trust Income Opportunities ETF (FCEF) is a ETF from First Trust Portfolios (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year FCEF returned +14.73% while VYM returned +23.85%. Year to date, FCEF is up 10.09% versus a gain of 15.75% for VYM.
Over three years, FCEF compounded at +16.17% per year against +19.14% for VYM; over five years the annualized figures are +6.20% and +12.45% respectively. Across the full 10-year window we track, VYM has the edge at +7.06% annualized vs +5.85%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
FCEF has been the more volatile fund, with annualized monthly volatility of 14.6% 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 -45.1% for FCEF 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 0.89. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
FCEF charges 3.69% per year while VYM charges 0.04%. On a $10,000 position that is $369 vs $4 annually, a gap of $365 per year that compounds over a long holding period. On income, FCEF currently yields 6.88% against 2.24% for VYM.
Holdings Overlap
FCEF and VYM share 0 holdings out of 663 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, FCEF or VYM?
FCEF has an expense ratio of 3.69% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $365 per year of difference.
Which performed better, FCEF or VYM?
Over the past year FCEF returned +14.73% vs +23.85% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (10 years), FCEF annualized +5.85% vs +7.06% for VYM. Past performance does not guarantee future results.
Which is riskier, FCEF or VYM?
FCEF has been the more volatile fund at 14.6% annualized versus 14.6% for VYM. Worst drawdown: FCEF -45.1% vs VYM -58.8%.
Should I hold both FCEF and VYM?
FCEF and VYM have a monthly-return correlation of 0.89, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FCEF and VYM?
FCEF and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 663 unique securities.
Which pays a higher dividend, FCEF or VYM?
FCEF yields 6.88% while VYM yields 2.24%, so FCEF currently pays the higher dividend yield.
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