VDIGX vs VEA
Vanguard Dividend Growth Fund Investor Class vs Vanguard FTSE Developed Markets ETF
Quick Verdict
VEA has a lower expense ratio. VEA delivered stronger 1-year returns. VEA offers more diversification with 3008 holdings.
Side-by-Side Comparison
| Metric | VDIGX | VEA | Winner |
|---|---|---|---|
| Expense Ratio | 0.22% | 0.03% | |
| AUM | $36.4B | $230.9B | |
| Dividend Yield | 1.87% | 2.57% | |
| Holdings | 55 | 3,918 | |
| YTD Return | -0.21% | +16.14% | |
| 1Y Return | -8.99% | +29.87% | |
| 3Y Return (annualized) | -3.09% | +20.12% | |
| 5Y Return (annualized) | -2.76% | +10.27% | |
| Volatility (annualized) | 16.1% | 17.8% | |
| Max Drawdown | -32.6% | -62.9% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | May 15, 1992 | Jul 20, 2007 |
VDIGX vs VEA Performance
Vanguard Dividend Growth Fund Investor Class (VDIGX) is a mutual fund from Vanguard (US) and Vanguard FTSE Developed Markets ETF (VEA) is a ETF from Vanguard (US). Over the past year VDIGX returned -8.99% while VEA returned +29.87%. Year to date, VDIGX is down 0.21% versus a gain of 16.14% for VEA.
Over three years, VDIGX compounded at -3.09% per year against +20.12% for VEA; over five years the annualized figures are -2.76% and +10.27% respectively. Across the full 5-year window we track, VEA has the edge at +3.14% annualized vs -2.76%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VEA has been the more volatile fund, with annualized monthly volatility of 17.8% compared with 16.1% for VDIGX. 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 -32.6% for VDIGX and -62.9% for VEA. 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 0.69. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VDIGX charges 0.22% per year while VEA charges 0.03%. On a $10,000 position that is $22 vs $3 annually, a gap of $19 per year that compounds over a long holding period. On income, VDIGX currently yields 1.87% against 2.57% for VEA.
Holdings Overlap
VDIGX and VEA share 3 holdings out of 3052 unique holdings combined, representing a 0.3% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VDIGX or VEA?
VDIGX has an expense ratio of 0.22% while VEA charges 0.03%. VEA is the cheaper option. On a $10,000 investment, that is $19 per year of difference.
Which performed better, VDIGX or VEA?
Over the past year VDIGX returned -8.99% vs +29.87% for VEA, so VEA leads on 1-year performance. Over the longest common window we track (5 years), VDIGX annualized -2.76% vs +3.14% for VEA. Past performance does not guarantee future results.
Which is riskier, VDIGX or VEA?
VEA has been the more volatile fund at 17.8% annualized versus 16.1% for VDIGX. Worst drawdown: VDIGX -32.6% vs VEA -62.9%.
Should I hold both VDIGX and VEA?
VDIGX and VEA have a monthly-return correlation of 0.69, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VDIGX and VEA?
VDIGX and VEA share 3 common holdings with a 0.3% weight overlap. Combined, they hold 3052 unique securities.
Which pays a higher dividend, VDIGX or VEA?
VDIGX yields 1.87% while VEA yields 2.57%, so VEA currently pays the higher dividend yield.
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