VTCIX vs VYM
Vanguard Tax-Managed Capital Appreciation Fund Institutional Shares vs Vanguard High Dividend Yield ETF
Quick Verdict
VTCIX has a lower expense ratio. VYM delivered stronger 1-year returns. VTCIX offers more diversification with 836 holdings.
Side-by-Side Comparison
| Metric | VTCIX | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.04% | |
| AUM | $5.2B | $81.6B | |
| Dividend Yield | 0.93% | 2.24% | |
| Holdings | 836 | 616 | |
| YTD Return | +12.53% | +14.66% | |
| 1Y Return | +20.38% | +22.16% | |
| 3Y Return (annualized) | +20.44% | +18.72% | |
| 5Y Return (annualized) | +11.10% | +12.18% | |
| Volatility (annualized) | 16.1% | 14.6% | |
| Max Drawdown | -26.0% | -58.8% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Equity | |
| Inception | Feb 24, 1999 | Nov 10, 2006 |
VTCIX vs VYM Performance
Vanguard Tax-Managed Capital Appreciation Fund Institutional Shares (VTCIX) is a mutual fund from Vanguard (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year VTCIX returned +20.38% while VYM returned +22.16%. Year to date, VTCIX is up 12.53% versus a gain of 14.66% for VYM.
Over three years, VTCIX compounded at +20.44% per year against +18.72% for VYM; over five years the annualized figures are +11.10% and +12.18% respectively. Across the full 5-year window we track, VTCIX has the edge at +11.10% annualized vs +7.01%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VTCIX has been the more volatile fund, with annualized monthly volatility of 16.1% compared with 14.6% for VYM. 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 -26.0% for VTCIX and -58.8% for VYM. 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 0.83. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VTCIX charges 0.03% per year while VYM charges 0.04%. On a $10,000 position that is $3 vs $4 annually, a gap of $1 per year that compounds over a long holding period. On income, VTCIX currently yields 0.93% against 2.24% for VYM.
Holdings Overlap
VTCIX and VYM share 312 holdings out of 1116 unique holdings combined, representing a 31.8% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VTCIX or VYM?
VTCIX has an expense ratio of 0.03% while VYM charges 0.04%. VTCIX is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, VTCIX or VYM?
Over the past year VTCIX returned +20.38% vs +22.16% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (5 years), VTCIX annualized +11.10% vs +7.01% for VYM. Past performance does not guarantee future results.
Which is riskier, VTCIX or VYM?
VTCIX has been the more volatile fund at 16.1% annualized versus 14.6% for VYM. Worst drawdown: VTCIX -26.0% vs VYM -58.8%.
Should I hold both VTCIX and VYM?
VTCIX and VYM have a monthly-return correlation of 0.83, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VTCIX and VYM?
VTCIX and VYM share 312 common holdings with a 31.8% weight overlap. Combined, they hold 1116 unique securities.
Which pays a higher dividend, VTCIX or VYM?
VTCIX yields 0.93% while VYM yields 2.24%, so VYM currently pays the higher dividend yield.
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