VNQ vs VTI
Vanguard Real Estate ETF vs Vanguard Morningstar Total Stock Market ETF
Quick Verdict
VTI has a lower expense ratio. VTI delivered stronger 1-year returns. VTI offers more diversification with 3,543 holdings.
Side-by-Side Comparison
| Metric | VNQ | VTI | Winner |
|---|---|---|---|
| Expense Ratio | 0.13% | 0.03% | |
| AUM | $39.3B | $666.9B | |
| Dividend Yield | 3.49% | 1.07% | |
| Holdings | 144 | 3,543 | |
| YTD Return | +13.46% | +13.14% | |
| 1Y Return | +13.14% | +22.35% | |
| 3Y Return (annualized) | +11.55% | +21.83% | |
| 5Y Return (annualized) | +2.33% | +12.01% | |
| Volatility (annualized) | 21.4% | 15.3% | |
| Max Drawdown | -75.8% | -56.6% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Sep 23, 2004 | May 24, 2001 |
VNQ vs VTI Performance
Vanguard Real Estate ETF (VNQ) is a ETF from Vanguard (US) and Vanguard Morningstar Total Stock Market ETF (VTI) is a ETF from Vanguard (US). Over the past year VNQ returned +13.14% while VTI returned +22.35%. Year to date, VNQ is up 13.46% versus a gain of 13.14% for VTI.
Over three years, VNQ compounded at +11.55% per year against +21.83% for VTI; over five years the annualized figures are +2.33% and +12.01% respectively. Across the full 22-year window we track, VTI has the edge at +8.09% annualized vs +4.13%. 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 15.3% for VTI. 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 -75.8% for VNQ and -56.6% for VTI. 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 0.75. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VNQ charges 0.13% per year while VTI charges 0.03%. On a $10,000 position that is $13 vs $3 annually, a gap of $10 per year that compounds over a long holding period. On income, VNQ currently yields 3.49% against 1.07% for VTI.
Holdings Overlap
VNQ and VTI share 106 holdings out of 2825 unique holdings combined, representing a 1.7% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VNQ or VTI?
VNQ has an expense ratio of 0.13% while VTI charges 0.03%. VTI is the cheaper option. On a $10,000 investment, that is $10 per year of difference.
Which performed better, VNQ or VTI?
Over the past year VNQ returned +13.14% vs +22.35% for VTI, so VTI leads on 1-year performance. Over the longest common window we track (22 years), VNQ annualized +4.13% vs +8.09% for VTI. Past performance does not guarantee future results.
Which is riskier, VNQ or VTI?
VNQ has been the more volatile fund at 21.4% annualized versus 15.3% for VTI. Worst drawdown: VNQ -75.8% vs VTI -56.6%.
Should I hold both VNQ and VTI?
VNQ and VTI have a monthly-return correlation of 0.75, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VNQ and VTI?
VNQ and VTI share 106 common holdings with a 1.7% weight overlap. Combined, they hold 2825 unique securities.
Which pays a higher dividend, VNQ or VTI?
VNQ yields 3.49% while VTI yields 1.07%, so VNQ currently pays the higher dividend yield.
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