FTHY vs VYM
FTHY vs VYM
First Trust High Yield Opportunities 2027 Term Fund 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 | FTHY | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 3.59% | 0.04% | |
| AUM | $662M | $79.0B | |
| Dividend Yield | 10.63% | 2.86% | |
| Holdings | 294 | 568 | |
| YTD Return | +2.21% | +15.80% | |
| 1Y Return | +2.32% | +26.12% | |
| 3Y Return (annualized) | +10.46% | +18.25% | |
| 5Y Return (annualized) | +2.28% | +12.51% | |
| Volatility (annualized) | 11.9% | 14.6% | |
| Max Drawdown | -31.2% | -58.8% | |
| Fund Family | First Trust Portfolios (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jun 25, 2020 | Nov 10, 2006 |
FTHY vs VYM Performance
First Trust High Yield Opportunities 2027 Term Fund (FTHY) 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 FTHY returned +2.32% while VYM returned +26.12%. Year to date, FTHY is up 2.21% versus a gain of 15.80% for VYM.
Over three years, FTHY compounded at +10.46% per year against +18.25% for VYM; over five years the annualized figures are +2.28% and +12.51% respectively. Across the full 6-year window we track, VYM has the edge at +7.07% annualized vs +2.71%. 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 11.9% for FTHY. 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 -31.2% for FTHY 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 0.67. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FTHY charges 3.59% per year while VYM charges 0.04%. On a $10,000 position that is $359 vs $4 annually, a gap of $355 per year that compounds over a long holding period. On income, FTHY currently yields 10.63% against 2.86% for VYM.
Holdings Overlap
FTHY and VYM share 0 holdings out of 788 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, FTHY or VYM?
FTHY has an expense ratio of 3.59% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $355 per year of difference.
Which performed better, FTHY or VYM?
Over the past year FTHY returned +2.32% vs +26.12% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (6 years), FTHY annualized +2.71% vs +7.07% for VYM. Past performance does not guarantee future results.
Which is riskier, FTHY or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 11.9% for FTHY. Worst drawdown: FTHY -31.2% vs VYM -58.8%.
Should I hold both FTHY and VYM?
FTHY and VYM have a monthly-return correlation of 0.67, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FTHY and VYM?
FTHY and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 788 unique securities.
Which pays a higher dividend, FTHY or VYM?
FTHY yields 10.63% while VYM yields 2.86%, so FTHY currently pays the higher dividend yield.
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