IYM vs VYM
iShares US Basic Materials ETF vs Vanguard High Dividend Yield ETF
Quick Verdict
VYM has a lower expense ratio. IYM delivered stronger 1-year returns. VYM offers more diversification with 616 holdings.
Side-by-Side Comparison
| Metric | IYM | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.38% | 0.04% | |
| AUM | $1.0B | $81.6B | |
| Dividend Yield | 1.30% | 2.24% | |
| Holdings | 43 | 616 | |
| YTD Return | +20.72% | +16.42% | |
| 1Y Return | +30.83% | +24.22% | |
| 3Y Return (annualized) | +14.71% | +19.03% | |
| 5Y Return (annualized) | +8.72% | +12.21% | |
| Volatility (annualized) | 22.2% | 14.6% | |
| Max Drawdown | -68.1% | -58.8% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Jun 12, 2000 | Nov 10, 2006 |
IYM vs VYM Performance
iShares US Basic Materials ETF (IYM) 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 IYM returned +30.83% while VYM returned +24.22%. Year to date, IYM is up 20.72% versus a gain of 16.42% for VYM.
Over three years, IYM compounded at +14.71% per year against +19.03% for VYM; over five years the annualized figures are +8.72% and +12.21% respectively. Across the full 20-year window we track, VYM has the edge at +7.10% annualized vs +7.02%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
IYM has been the more volatile fund, with annualized monthly volatility of 22.2% 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 -68.1% for IYM 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 0.82. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
IYM 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, IYM currently yields 1.30% against 2.24% for VYM.
Holdings Overlap
IYM and VYM share 20 holdings out of 623 unique holdings combined, representing a 2.8% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IYM or VYM?
IYM 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, IYM or VYM?
Over the past year IYM returned +30.83% vs +24.22% for VYM, so IYM leads on 1-year performance. Over the longest common window we track (20 years), IYM annualized +7.02% vs +7.10% for VYM. Past performance does not guarantee future results.
Which is riskier, IYM or VYM?
IYM has been the more volatile fund at 22.2% annualized versus 14.6% for VYM. Worst drawdown: IYM -68.1% vs VYM -58.8%.
Should I hold both IYM and VYM?
IYM and VYM have a monthly-return correlation of 0.82, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IYM and VYM?
IYM and VYM share 20 common holdings with a 2.8% weight overlap. Combined, they hold 623 unique securities.
Which pays a higher dividend, IYM or VYM?
IYM yields 1.30% while VYM yields 2.24%, so VYM currently pays the higher dividend yield.
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