FEMB vs VTI
First Trust Emerging Markets Local Currency Bond ETF vs Vanguard Morningstar Total Stock Market ETF
Quick Verdict
VTI has a lower expense ratio. VTI delivered stronger 1-year returns. VTI offers more diversification with 3,543 holdings.
Side-by-Side Comparison
| Metric | FEMB | VTI | Winner |
|---|---|---|---|
| Expense Ratio | 0.85% | 0.03% | |
| AUM | $380M | $666.9B | |
| Dividend Yield | 6.19% | 1.07% | |
| Holdings | 68 | 3,543 | |
| YTD Return | +2.96% | +14.82% | |
| 1Y Return | +7.98% | +22.43% | |
| 3Y Return (annualized) | +7.72% | +21.93% | |
| 5Y Return (annualized) | +3.10% | +12.34% | |
| Volatility (annualized) | 11.4% | 15.4% | |
| Max Drawdown | -47.5% | -56.6% | |
| Fund Family | First Trust Portfolios (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Nov 4, 2014 | May 24, 2001 |
FEMB vs VTI Performance
First Trust Emerging Markets Local Currency Bond ETF (FEMB) is a ETF from First Trust Portfolios (US) and Vanguard Morningstar Total Stock Market ETF (VTI) is a ETF from Vanguard (US). Over the past year FEMB returned +7.98% while VTI returned +22.43%. Year to date, FEMB is up 2.96% versus a gain of 14.82% for VTI.
Over three years, FEMB compounded at +7.72% per year against +21.93% for VTI; over five years the annualized figures are +3.10% and +12.34% respectively. Across the full 12-year window we track, VTI has the edge at +8.16% annualized vs -1.78%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VTI has been the more volatile fund, with annualized monthly volatility of 15.4% compared with 11.4% for FEMB. 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 -47.5% for FEMB 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 0.56. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FEMB charges 0.85% per year while VTI charges 0.03%. On a $10,000 position that is $85 vs $3 annually, a gap of $82 per year that compounds over a long holding period. On income, FEMB currently yields 6.19% against 1.07% for VTI.
Holdings Overlap
FEMB and VTI share 0 holdings out of 2788 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, FEMB or VTI?
FEMB has an expense ratio of 0.85% while VTI charges 0.03%. VTI is the cheaper option. On a $10,000 investment, that is $82 per year of difference.
Which performed better, FEMB or VTI?
Over the past year FEMB returned +7.98% vs +22.43% for VTI, so VTI leads on 1-year performance. Over the longest common window we track (12 years), FEMB annualized -1.78% vs +8.16% for VTI. Past performance does not guarantee future results.
Which is riskier, FEMB or VTI?
VTI has been the more volatile fund at 15.4% annualized versus 11.4% for FEMB. Worst drawdown: FEMB -47.5% vs VTI -56.6%.
Should I hold both FEMB and VTI?
FEMB and VTI have a monthly-return correlation of 0.56, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FEMB and VTI?
FEMB and VTI share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2788 unique securities.
Which pays a higher dividend, FEMB or VTI?
FEMB yields 6.19% while VTI yields 1.07%, so FEMB currently pays the higher dividend yield.
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