The Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) and the SPDR Gold Shares (GLD) are both among the Top 100 ETFs. VIG is a Vanguard Large Blend fund and GLD is a SPDR State Street Global Advisors N/A fund. So, what’s the difference between VIG and GLD? And which fund is better?
The expense ratio of VIG is 0.34 percentage points lower than GLD’s (0.06% vs. 0.4%). VIG also has a higher exposure to the industrials sector and a lower standard deviation. Overall, VIG has provided higher returns than GLD over the past ten years.
In this article, we’ll compare VIG vs. GLD. We’ll look at holdings and portfolio growth, as well as at their risk metrics and industry exposure. Moreover, I’ll also discuss VIG’s and GLD’s annual returns, performance, and fund composition and examine how these affect their overall returns.
|Name||Vanguard Dividend Appreciation Index Fund ETF Shares||SPDR Gold Shares|
|Issuer||Vanguard||SPDR State Street Global Advisors|
The Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) is a Large Blend fund that is issued by Vanguard. It currently has 71.92B total assets under management and has yielded an average annual return of 13.35% over the past 10 years. The fund has a dividend yield of 1.56% with an expense ratio of 0.06%.
The SPDR Gold Shares (GLD) is a N/A fund that is issued by SPDR State Street Global Advisors. It currently has 59.26B total assets under management and has yielded an average annual return of 5.81% over the past 10 years. The fund has a dividend yield of 0.0% with an expense ratio of 0.4%.
VIG’s dividend yield is 1.56% higher than that of GLD (1.56% vs. 0.0%). Also, VIG yielded on average 7.54% more per year over the past decade (13.35% vs. 5.81%). The expense ratio of VIG is 0.34 percentage points lower than GLD’s (0.06% vs. 0.4%).
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The Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) has the most exposure to the Industrials sector at 17.23%. This is followed by Financial Services and Healthcare at 17.18% and 15.52% respectively. Energy (0.0%), Utilities (2.81%), and Communication Services (2.86%) only make up 5.67% of the fund’s total assets.
VIG’s mid-section with moderate exposure is comprised of Basic Materials, Consumer Cyclical, Technology, Consumer Defensive, and Healthcare stocks at 3.67%, 10.47%, 14.93%, 15.32%, and 15.52%.
The SPDR Gold Shares (GLD) has the most exposure to the Technology sector at 0.0%. This is followed by Industrials and Energy at 0.0% and 0.0% respectively. Consumer Cyclical (0.0%), Financial Services (0.0%), and Real Estate (0.0%) only make up 0.00% of the fund’s total assets.
GLD’s mid-section with moderate exposure is comprised of Consumer Defensive, Healthcare, Utilities, Communication Services, and Energy stocks at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%.
VIG is 17.23% more exposed to the Industrials sector than GLD (17.23% vs 0.0%). VIG’s exposure to Financial Services and Healthcare stocks is 17.18% higher and 15.52% higher respectively (17.18% vs. 0.0% and 15.52% vs. 0.0%). In total, Energy, Utilities, and Communication Services also make up 5.67% more of the fund’s holdings compared to GLD (5.67% vs. 0.00%).
|JPMorgan Chase & Co||3.8%|
|Johnson & Johnson||3.67%|
|Visa Inc Class A||3.22%|
|UnitedHealth Group Inc||3.22%|
|The Home Depot Inc||2.91%|
|Procter & Gamble Co||2.82%|
|Comcast Corp Class A||2.21%|
VIG’s Top Holdings are Microsoft Corp, JPMorgan Chase & Co, Johnson & Johnson, Walmart Inc, and Visa Inc Class A at 4.19%, 3.8%, 3.67%, 3.38%, and 3.22%.
UnitedHealth Group Inc (3.22%), The Home Depot Inc (2.91%), and Procter & Gamble Co (2.82%) have a slightly smaller but still significant weight. Comcast Corp Class A and Coca-Cola Co are also represented in the VIG’s holdings at 2.21% and 1.98%.
GLD’s Top Holdings are Gold Trust, N/A, N/A, N/A, and N/A at 100.0%, 0%, 0%, 0%, and 0%.
N/A (0%), N/A (0%), and N/A (0%) have a slightly smaller but still significant weight. N/A and N/A are also represented in the GLD’s holdings at 0% and 0%.
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The Vanguard Dividend Appreciation Index Fund ETF Shares (VIG) has a Mean Return of 1.09 with a Alpha of 0.12 and a Standard Deviation of 12.25. Its Beta is 0.86 while VIG’s R-squared is 92.2. Furthermore, the fund has a Sharpe Ratio of 1.01 and a Treynor Ratio of 14.33.
The SPDR Gold Shares (GLD) has a Alpha of 3.91 with a Treynor Ratio of 1.21 and a Standard Deviation of 16.58. Its R-squared is 16.21 while GLD’s Sharpe Ratio is 0.12. Furthermore, the fund has a Mean Return of 0.21 and a Beta of 0.48.
VIG’s Mean Return is 0.88 points higher than that of GLD and its R-squared is 75.99 points higher. With a Standard Deviation of 12.25, VIG is slightly less volatile than GLD. The Alpha and Beta of VIG are 3.79 points lower and 0.38 points higher than GLD’s Alpha and Beta.
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VIG had its best year in 2019 with an annual return of 29.71%. VIG’s worst year over the past decade yielded -2.02% and occurred in 2018. In most years the Vanguard Dividend Appreciation Index Fund ETF Shares provided moderate returns such as in 2012, 2016, and 2010 where annual returns amounted to 11.61%, 11.84%, and 14.67% respectively.
The year 2010 was the strongest year for GLD, returning 27.25% on an annual basis. The poorest year for GLD in the last ten years was 2013, with a yield of -28.09%. Most years the SPDR Gold Shares has given investors modest returns, such as in 2012, 2016, and 2011, when gains were 5.26%, 8.69%, and 11.2% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in VIG would have resulted in a final balance of $37,951. This is a profit of $27,951 over 11 years and amounts to a compound annual growth rate (CAGR) of 13.35%.
With a $10,000 investment in GLD, the end total would have been $16,395. This equates to a $6,395 profit over 11 years and a compound annual growth rate (CAGR) of 5.81%.
VIG’s CAGR is 7.54 percentage points higher than that of GLD and as a result, would have yielded $21,556 more on a $10,000 investment. Thus, VIG outperformed GLD by 7.54% annually.
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