NMCO vs VYM
NMCO vs VYM
Nuveen Municipal Credit Opportunities 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 | NMCO | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 4.50% | 0.04% | |
| AUM | - | $79.0B | |
| Dividend Yield | 7.60% | 2.86% | |
| Holdings | 430 | 568 | |
| YTD Return | +7.53% | +15.80% | |
| 1Y Return | +12.13% | +26.12% | |
| 3Y Return (annualized) | +4.91% | +18.25% | |
| 5Y Return (annualized) | -1.71% | +12.51% | |
| Volatility (annualized) | 20.2% | 14.6% | |
| Max Drawdown | -43.0% | -58.8% | |
| Fund Family | Nuveen | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Sep 16, 2019 | Nov 10, 2006 |
NMCO vs VYM Performance
Nuveen Municipal Credit Opportunities Fund (NMCO) is a ETF from Nuveen and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year NMCO returned +12.13% while VYM returned +26.12%. Year to date, NMCO is up 7.53% versus a gain of 15.80% for VYM.
Over three years, NMCO compounded at +4.91% per year against +18.25% for VYM; over five years the annualized figures are -1.71% and +12.51% respectively. Across the full 7-year window we track, VYM has the edge at +7.07% annualized vs -0.38%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
NMCO has been the more volatile fund, with annualized monthly volatility of 20.2% 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 -43.0% for NMCO 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 0.53. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
NMCO charges 4.50% per year while VYM charges 0.04%. On a $10,000 position that is $450 vs $4 annually, a gap of $446 per year that compounds over a long holding period. On income, NMCO currently yields 7.60% against 2.86% for VYM.
Holdings Overlap
NMCO and VYM share 0 holdings out of 713 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, NMCO or VYM?
NMCO has an expense ratio of 4.50% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $446 per year of difference.
Which performed better, NMCO or VYM?
Over the past year NMCO returned +12.13% vs +26.12% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (7 years), NMCO annualized -0.38% vs +7.07% for VYM. Past performance does not guarantee future results.
Which is riskier, NMCO or VYM?
NMCO has been the more volatile fund at 20.2% annualized versus 14.6% for VYM. Worst drawdown: NMCO -43.0% vs VYM -58.8%.
Should I hold both NMCO and VYM?
NMCO and VYM have a monthly-return correlation of 0.53, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between NMCO and VYM?
NMCO and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 713 unique securities.
Which pays a higher dividend, NMCO or VYM?
NMCO yields 7.60% while VYM yields 2.86%, so NMCO currently pays the higher dividend yield.
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