IQI vs VYM
Invesco Quality Municipal Income Trust 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 | IQI | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 1.71% | 0.04% | |
| AUM | $3,048.42 | $81.6B | |
| Dividend Yield | 7.66% | 2.24% | |
| Holdings | 485 | 616 | |
| YTD Return | +5.54% | +14.66% | |
| 1Y Return | +15.56% | +22.16% | |
| 3Y Return (annualized) | +10.54% | +18.72% | |
| 5Y Return (annualized) | -0.13% | +12.18% | |
| Volatility (annualized) | 11.6% | 14.6% | |
| Max Drawdown | -57.6% | -58.8% | |
| Fund Family | Invesco (US) | Vanguard (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Sep 29, 1992 | Nov 10, 2006 |
IQI vs VYM Performance
Invesco Quality Municipal Income Trust (IQI) is a ETF from Invesco (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year IQI returned +15.56% while VYM returned +22.16%. Year to date, IQI is up 5.54% versus a gain of 14.66% for VYM.
Over three years, IQI compounded at +10.54% per year against +18.72% for VYM; over five years the annualized figures are -0.13% and +12.18% respectively. Across the full 20-year window we track, VYM has the edge at +7.01% annualized vs -0.01%. 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 11.6% for IQI. 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 -57.6% for IQI 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 0.34. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
IQI charges 1.71% per year while VYM charges 0.04%. On a $10,000 position that is $171 vs $4 annually, a gap of $167 per year that compounds over a long holding period. On income, IQI currently yields 7.66% against 2.24% for VYM.
Holdings Overlap
IQI and VYM share 0 holdings out of 848 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, IQI or VYM?
IQI has an expense ratio of 1.71% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $167 per year of difference.
Which performed better, IQI or VYM?
Over the past year IQI returned +15.56% vs +22.16% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), IQI annualized -0.01% vs +7.01% for VYM. Past performance does not guarantee future results.
Which is riskier, IQI or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 11.6% for IQI. Worst drawdown: IQI -57.6% vs VYM -58.8%.
Should I hold both IQI and VYM?
IQI and VYM have a monthly-return correlation of 0.34, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IQI and VYM?
IQI and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 848 unique securities.
Which pays a higher dividend, IQI or VYM?
IQI yields 7.66% while VYM yields 2.24%, so IQI currently pays the higher dividend yield.
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