VDIGX vs VNQ
Vanguard Dividend Growth Fund Investor Class vs Vanguard Real Estate ETF
Quick Verdict
VNQ has a lower expense ratio. VNQ delivered stronger 1-year returns. VNQ offers more diversification with 144 holdings.
Side-by-Side Comparison
| Metric | VDIGX | VNQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.20% | 0.13% | |
| AUM | $35.5B | $39.3B | |
| Dividend Yield | 23.36% | 3.49% | |
| Holdings | 55 | 144 | |
| YTD Return | -0.88% | +13.57% | |
| 1Y Return | -11.33% | +12.92% | |
| 3Y Return (annualized) | -2.77% | +11.70% | |
| 5Y Return (annualized) | -3.21% | +2.31% | |
| Volatility (annualized) | 16.1% | 21.4% | |
| Max Drawdown | -32.6% | -75.8% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | May 15, 1992 | Sep 23, 2004 |
VDIGX vs VNQ Performance
Vanguard Dividend Growth Fund Investor Class (VDIGX) is a mutual fund from Vanguard (US) and Vanguard Real Estate ETF (VNQ) is a ETF from Vanguard (US). Over the past year VDIGX returned -11.33% while VNQ returned +12.92%. Year to date, VDIGX is down 0.88% versus a gain of 13.57% for VNQ.
Over three years, VDIGX compounded at -2.77% per year against +11.70% for VNQ; over five years the annualized figures are -3.21% and +2.31% respectively. Across the full 5-year window we track, VNQ has the edge at +4.14% annualized vs -3.21%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VNQ has been the more volatile fund, with annualized monthly volatility of 21.4% 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 -75.8% for VNQ. 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 0.73. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VDIGX charges 0.20% per year while VNQ charges 0.13%. On a $10,000 position that is $20 vs $13 annually, a gap of $7 per year that compounds over a long holding period. On income, VDIGX currently yields 23.36% against 3.49% for VNQ.
Holdings Overlap
VDIGX and VNQ share 0 holdings out of 191 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, VDIGX or VNQ?
VDIGX has an expense ratio of 0.20% while VNQ charges 0.13%. VNQ is the cheaper option. On a $10,000 investment, that is $7 per year of difference.
Which performed better, VDIGX or VNQ?
Over the past year VDIGX returned -11.33% vs +12.92% for VNQ, so VNQ leads on 1-year performance. Over the longest common window we track (5 years), VDIGX annualized -3.21% vs +4.14% for VNQ. Past performance does not guarantee future results.
Which is riskier, VDIGX or VNQ?
VNQ has been the more volatile fund at 21.4% annualized versus 16.1% for VDIGX. Worst drawdown: VDIGX -32.6% vs VNQ -75.8%.
Should I hold both VDIGX and VNQ?
VDIGX and VNQ have a monthly-return correlation of 0.73, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VDIGX and VNQ?
VDIGX and VNQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 191 unique securities.
Which pays a higher dividend, VDIGX or VNQ?
VDIGX yields 23.36% while VNQ yields 3.49%, so VDIGX currently pays the higher dividend yield.
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