VGK vs VNQ
Vanguard FTSE Europe ETF vs Vanguard Real Estate ETF
Quick Verdict
VGK has a lower expense ratio. VGK delivered stronger 1-year returns. VGK offers more diversification with 1,251 holdings.
Side-by-Side Comparison
| Metric | VGK | VNQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.06% | 0.13% | |
| AUM | $30.5B | $39.3B | |
| Dividend Yield | 2.82% | 3.49% | |
| Holdings | 1,251 | 144 | |
| YTD Return | +11.24% | +13.84% | |
| 1Y Return | +20.91% | +15.14% | |
| 3Y Return (annualized) | +18.67% | +10.79% | |
| 5Y Return (annualized) | +9.28% | +2.35% | |
| Volatility (annualized) | 18.5% | 21.4% | |
| Max Drawdown | -67.3% | -75.8% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Mar 4, 2005 | Sep 23, 2004 |
VGK vs VNQ Performance
Vanguard FTSE Europe ETF (VGK) is a ETF from Vanguard (US) and Vanguard Real Estate ETF (VNQ) is a ETF from Vanguard (US). Over the past year VGK returned +20.91% while VNQ returned +15.14%. Year to date, VGK is up 11.24% versus a gain of 13.84% for VNQ.
Over three years, VGK compounded at +18.67% per year against +10.79% for VNQ; over five years the annualized figures are +9.28% and +2.35% respectively. Across the full 21-year window we track, VNQ has the edge at +4.15% annualized vs +3.69%. 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 18.5% for VGK. 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 -67.3% for VGK 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 0.68. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VGK charges 0.06% per year while VNQ charges 0.13%. On a $10,000 position that is $6 vs $13 annually, a gap of $7 per year that compounds over a long holding period. On income, VGK currently yields 2.82% against 3.49% for VNQ.
Holdings Overlap
VGK and VNQ share 1 holdings out of 1320 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in VGK | Weight in VNQ | Difference |
|---|---|---|---|
| CWK:LN | 0.02% | 0.16% | 0.14% |
Frequently Asked Questions
Which is cheaper, VGK or VNQ?
VGK has an expense ratio of 0.06% while VNQ charges 0.13%. VGK is the cheaper option. On a $10,000 investment, that is $7 per year of difference.
Which performed better, VGK or VNQ?
Over the past year VGK returned +20.91% vs +15.14% for VNQ, so VGK leads on 1-year performance. Over the longest common window we track (21 years), VGK annualized +3.69% vs +4.15% for VNQ. Past performance does not guarantee future results.
Which is riskier, VGK or VNQ?
VNQ has been the more volatile fund at 21.4% annualized versus 18.5% for VGK. Worst drawdown: VGK -67.3% vs VNQ -75.8%.
Should I hold both VGK and VNQ?
VGK and VNQ have a monthly-return correlation of 0.68, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VGK and VNQ?
VGK and VNQ share 1 common holdings with a 0.0% weight overlap. Combined, they hold 1320 unique securities.
Which pays a higher dividend, VGK or VNQ?
VGK yields 2.82% while VNQ yields 3.49%, so VNQ currently pays the higher dividend yield.
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