VEU vs VO
Vanguard FTSE All World Ex US ETF vs Vanguard Morningstar Mid-Cap ETF
Quick Verdict
VO has a lower expense ratio. VEU delivered stronger 1-year returns. VEU offers more diversification with 3,928 holdings.
Side-by-Side Comparison
| Metric | VEU | VO | Winner |
|---|---|---|---|
| Expense Ratio | 0.04% | 0.03% | |
| AUM | $68.4B | $106.6B | |
| Dividend Yield | 2.55% | 1.32% | |
| Holdings | 3,928 | 289 | |
| YTD Return | +14.04% | +11.90% | |
| 1Y Return | +26.43% | +14.49% | |
| 3Y Return (annualized) | +20.01% | +16.06% | |
| 5Y Return (annualized) | +9.08% | +7.18% | |
| Volatility (annualized) | 17.7% | 16.9% | |
| Max Drawdown | -62.8% | -60.3% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Mar 2, 2007 | Jan 26, 2004 |
VEU vs VO Performance
Vanguard FTSE All World Ex US ETF (VEU) is a ETF from Vanguard (US) and Vanguard Morningstar Mid-Cap ETF (VO) is a ETF from Vanguard (US). Over the past year VEU returned +26.43% while VO returned +14.49%. Year to date, VEU is up 14.04% versus a gain of 11.90% for VO.
Over three years, VEU compounded at +20.01% per year against +16.06% for VO; over five years the annualized figures are +9.08% and +7.18% respectively. Across the full 20-year window we track, VO has the edge at +9.10% annualized vs +3.52%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VEU has been the more volatile fund, with annualized monthly volatility of 17.7% compared with 16.9% for VO. 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 -62.8% for VEU and -60.3% for VO. 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 0.86. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VEU charges 0.04% per year while VO charges 0.03%. On a $10,000 position that is $4 vs $3 annually, a gap of $1 per year that compounds over a long holding period. On income, VEU currently yields 2.55% against 1.32% for VO.
Holdings Overlap
VEU and VO share 4 holdings out of 3933 unique holdings combined, representing a 0.2% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VEU or VO?
VEU has an expense ratio of 0.04% while VO charges 0.03%. VO is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, VEU or VO?
Over the past year VEU returned +26.43% vs +14.49% for VO, so VEU leads on 1-year performance. Over the longest common window we track (20 years), VEU annualized +3.52% vs +9.10% for VO. Past performance does not guarantee future results.
Which is riskier, VEU or VO?
VEU has been the more volatile fund at 17.7% annualized versus 16.9% for VO. Worst drawdown: VEU -62.8% vs VO -60.3%.
Should I hold both VEU and VO?
VEU and VO have a monthly-return correlation of 0.86, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VEU and VO?
VEU and VO share 4 common holdings with a 0.2% weight overlap. Combined, they hold 3933 unique securities.
Which pays a higher dividend, VEU or VO?
VEU yields 2.55% while VO yields 1.32%, so VEU currently pays the higher dividend yield.
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