IYF vs VYM
iShares US Financials 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 616 holdings.
Side-by-Side Comparison
| Metric | IYF | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.38% | 0.04% | |
| AUM | $4.4B | $81.6B | |
| Dividend Yield | 1.42% | 2.24% | |
| Holdings | 147 | 616 | |
| YTD Return | +5.86% | +15.34% | |
| 1Y Return | +12.53% | +23.24% | |
| 3Y Return (annualized) | +23.98% | +19.22% | |
| 5Y Return (annualized) | +11.97% | +12.21% | |
| Volatility (annualized) | 19.3% | 14.6% | |
| Max Drawdown | -80.2% | -58.8% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | May 22, 2000 | Nov 10, 2006 |
IYF vs VYM Performance
iShares US Financials ETF (IYF) 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 IYF returned +12.53% while VYM returned +23.24%. Year to date, IYF is up 5.86% versus a gain of 15.34% for VYM.
Over three years, IYF compounded at +23.98% per year against +19.22% for VYM; over five years the annualized figures are +11.97% and +12.21% respectively. Across the full 20-year window we track, VYM has the edge at +7.04% annualized vs +5.46%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IYF has been the more volatile fund, with annualized monthly volatility of 19.3% compared with 14.6% for VYM. 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 -80.2% for IYF 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 0.90. They move almost in lockstep, so holding both mostly duplicates the same exposure.
Fees and Cost Over Time
IYF charges 0.38% per year while VYM charges 0.04%. On a $10,000 position that is $38 vs $4 annually, a gap of $34 per year that compounds over a long holding period. On income, IYF currently yields 1.42% against 2.24% for VYM.
Holdings Overlap
IYF and VYM share 97 holdings out of 649 unique holdings combined, representing a 18.6% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IYF or VYM?
IYF has an expense ratio of 0.38% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $34 per year of difference.
Which performed better, IYF or VYM?
Over the past year IYF returned +12.53% vs +23.24% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), IYF annualized +5.46% vs +7.04% for VYM. Past performance does not guarantee future results.
Which is riskier, IYF or VYM?
IYF has been the more volatile fund at 19.3% annualized versus 14.6% for VYM. Worst drawdown: IYF -80.2% vs VYM -58.8%.
Should I hold both IYF and VYM?
IYF and VYM have a monthly-return correlation of 0.90, so they move almost identically. Holding both adds little diversification - most investors pick one, usually on fees or the specific index tracked.
What is the holdings overlap between IYF and VYM?
IYF and VYM share 97 common holdings with a 18.6% weight overlap. Combined, they hold 649 unique securities.
Which pays a higher dividend, IYF or VYM?
IYF yields 1.42% while VYM yields 2.24%, so VYM currently pays the higher dividend yield.
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