VTIP vs VXF
Vanguard Short-Term Inflation-Protected Securities ETF vs Vanguard Extended Market ETF
Quick Verdict
VTIP has a lower expense ratio. VXF delivered stronger 1-year returns. VXF offers more diversification with 2462 holdings.
Side-by-Side Comparison
| Metric | VTIP | VXF | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.05% | |
| AUM | $19.3B | $31.6B | |
| Dividend Yield | 3.60% | 1.21% | |
| Holdings | 27 | 3,376 | |
| YTD Return | +1.89% | +17.10% | |
| 1Y Return | +2.97% | +27.13% | |
| 3Y Return (annualized) | +5.46% | +19.27% | |
| 5Y Return (annualized) | +3.38% | +6.90% | |
| Volatility (annualized) | 2.4% | 18.7% | |
| Max Drawdown | -7.1% | -59.4% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Oct 12, 2012 | Dec 27, 2001 |
VTIP vs VXF Performance
Vanguard Short-Term Inflation-Protected Securities ETF (VTIP) is a ETF from Vanguard (US) and Vanguard Extended Market ETF (VXF) is a ETF from Vanguard (US). Over the past year VTIP returned +2.97% while VXF returned +27.13%. Year to date, VTIP is up 1.89% versus a gain of 17.10% for VXF.
Over three years, VTIP compounded at +5.46% per year against +19.27% for VXF; over five years the annualized figures are +3.38% and +6.90% respectively. Across the full 14-year window we track, VXF has the edge at +9.07% annualized vs +1.58%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VXF has been the more volatile fund, with annualized monthly volatility of 18.7% compared with 2.4% for VTIP. 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 -7.1% for VTIP and -59.4% for VXF. 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 0.42. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VTIP charges 0.03% per year while VXF charges 0.05%. On a $10,000 position that is $3 vs $5 annually, a gap of $2 per year that compounds over a long holding period. On income, VTIP currently yields 3.60% against 1.21% for VXF.
Holdings Overlap
VTIP and VXF share 0 holdings out of 2485 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, VTIP or VXF?
VTIP has an expense ratio of 0.03% while VXF charges 0.05%. VTIP is the cheaper option. On a $10,000 investment, that is $2 per year of difference.
Which performed better, VTIP or VXF?
Over the past year VTIP returned +2.97% vs +27.13% for VXF, so VXF leads on 1-year performance. Over the longest common window we track (14 years), VTIP annualized +1.58% vs +9.07% for VXF. Past performance does not guarantee future results.
Which is riskier, VTIP or VXF?
VXF has been the more volatile fund at 18.7% annualized versus 2.4% for VTIP. Worst drawdown: VTIP -7.1% vs VXF -59.4%.
Should I hold both VTIP and VXF?
VTIP and VXF have a monthly-return correlation of 0.42, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VTIP and VXF?
VTIP and VXF share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2485 unique securities.
Which pays a higher dividend, VTIP or VXF?
VTIP yields 3.60% while VXF yields 1.21%, so VTIP currently pays the higher dividend yield.
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