FLOT vs VYM
iShares Floating Rate Bond 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 558 holdings.
Side-by-Side Comparison
| Metric | FLOT | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.15% | 0.04% | |
| AUM | $10.2B | $79.0B | |
| Dividend Yield | 4.53% | 2.86% | |
| Holdings | 551 | 568 | |
| YTD Return | +0.14% | +16.53% | |
| 1Y Return | +1.58% | +25.03% | |
| 3Y Return (annualized) | +4.48% | +18.54% | |
| 5Y Return (annualized) | +3.76% | +12.25% | |
| Volatility (annualized) | 1.7% | 14.6% | |
| Max Drawdown | -13.5% | -58.8% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jun 14, 2011 | Nov 10, 2006 |
FLOT vs VYM Performance
iShares Floating Rate Bond ETF (FLOT) is a ETF from iShares by BlackRock (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year FLOT returned +1.58% while VYM returned +25.03%. Year to date, FLOT is up 0.14% versus a gain of 16.53% for VYM.
Over three years, FLOT compounded at +4.48% per year against +18.54% for VYM; over five years the annualized figures are +3.76% and +12.25% respectively. Across the full 15-year window we track, VYM has the edge at +7.10% annualized vs +2.12%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.6% compared with 1.7% for FLOT. 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 -13.5% for FLOT 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 0.41. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FLOT charges 0.15% per year while VYM charges 0.04%. On a $10,000 position that is $15 vs $4 annually, a gap of $11 per year that compounds over a long holding period. On income, FLOT currently yields 4.53% against 2.86% for VYM.
Holdings Overlap
FLOT and VYM share 0 holdings out of 932 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, FLOT or VYM?
FLOT has an expense ratio of 0.15% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $11 per year of difference.
Which performed better, FLOT or VYM?
Over the past year FLOT returned +1.58% vs +25.03% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (15 years), FLOT annualized +2.12% vs +7.10% for VYM. Past performance does not guarantee future results.
Which is riskier, FLOT or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 1.7% for FLOT. Worst drawdown: FLOT -13.5% vs VYM -58.8%.
Should I hold both FLOT and VYM?
FLOT and VYM have a monthly-return correlation of 0.41, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FLOT and VYM?
FLOT and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 932 unique securities.
Which pays a higher dividend, FLOT or VYM?
FLOT yields 4.53% while VYM yields 2.86%, so FLOT currently pays the higher dividend yield.
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