FXE vs VTI

Quick Verdict

VTI has a lower expense ratio. VTI delivered stronger 1-year returns. VTI offers more diversification with 2783 holdings.

Lower Fees: VTIHigher Returns: VTIMore Diversified: VTI

Side-by-Side Comparison

MetricFXEVTIWinner
Expense Ratio0.40%0.03%
AUM$336M$663.5B
Dividend Yield0.74%1.07%
Holdings23,543
YTD Return-1.09%+14.16%
1Y Return+0.15%+23.62%
3Y Return (annualized)+3.28%+21.43%
5Y Return (annualized)+0.50%+12.33%
Volatility (annualized)9.1%15.3%
Max Drawdown-44.7%-56.6%
Fund FamilyInvesco (US)Vanguard (US)
CategoryAlternativeEquity
InceptionDec 9, 2005May 24, 2001

FXE vs VTI Performance

Invesco CurrencyShares Euro Currency Trust (FXE) is a ETF from Invesco (US) and Vanguard Total Stock Market ETF (VTI) is a ETF from Vanguard (US). Over the past year FXE returned +0.15% while VTI returned +23.62%. Year to date, FXE is down 1.09% versus a gain of 14.16% for VTI.

Over three years, FXE compounded at +3.28% per year against +21.43% for VTI; over five years the annualized figures are +0.50% and +12.33% respectively. Across the full 21-year window we track, VTI has the edge at +8.14% annualized vs -0.31%. Past performance does not guarantee future results.

Risk: Volatility and Drawdowns

VTI has been the more volatile fund, with annualized monthly volatility of 15.3% compared with 9.1% for FXE. 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 -44.7% for FXE 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 0.39. They move independently enough that combining them can meaningfully diversify a portfolio.

Fees and Cost Over Time

FXE charges 0.40% per year while VTI charges 0.03%. On a $10,000 position that is $40 vs $3 annually, a gap of $37 per year that compounds over a long holding period. On income, FXE currently yields 0.74% against 1.07% for VTI.

Frequently Asked Questions

Which is cheaper, FXE or VTI?

FXE has an expense ratio of 0.40% while VTI charges 0.03%. VTI is the cheaper option. On a $10,000 investment, that is $37 per year of difference.

Which performed better, FXE or VTI?

Over the past year FXE returned +0.15% vs +23.62% for VTI, so VTI leads on 1-year performance. Over the longest common window we track (21 years), FXE annualized -0.31% vs +8.14% for VTI. Past performance does not guarantee future results.

Which is riskier, FXE or VTI?

VTI has been the more volatile fund at 15.3% annualized versus 9.1% for FXE. Worst drawdown: FXE -44.7% vs VTI -56.6%.

Should I hold both FXE and VTI?

FXE and VTI have a monthly-return correlation of 0.39, so combining them can provide real diversification depending on your allocation goals.

Which pays a higher dividend, FXE or VTI?

FXE yields 0.74% while VTI yields 1.07%, so VTI currently pays the higher dividend yield.

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