The Vanguard Real Estate Index Fund ETF Shares (VNQ) and the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) are both among the Top 100 ETFs. VNQ is a Vanguard Real Estate fund and MINT is a PIMCO Ultrashort Bond fund. So, what’s the difference between VNQ and MINT? And which fund is better?
The expense ratio of VNQ is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%). VNQ also has a high exposure to the real estate sector while MINT is mostly comprised of Others bonds. Overall, VNQ has provided higher returns than MINT over the past ten years.
In this article, we’ll compare VNQ vs. MINT. We’ll look at portfolio growth and risk metrics, as well as at their holdings and annual returns. Moreover, I’ll also discuss VNQ’s and MINT’s industry exposure, performance, and fund composition and examine how these affect their overall returns.
|Name||Vanguard Real Estate Index Fund ETF Shares||PIMCO Enhanced Short Maturity Active Exchange-Traded Fund|
|Category||Real Estate||Ultrashort Bond|
The Vanguard Real Estate Index Fund ETF Shares (VNQ) is a Real Estate fund that is issued by Vanguard. It currently has 77.34B total assets under management and has yielded an average annual return of 11.05% over the past 10 years. The fund has a dividend yield of 2.34% with an expense ratio of 0.12%.
The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) is a Ultrashort Bond fund that is issued by PIMCO. It currently has 14.02B total assets under management and has yielded an average annual return of 1.52% over the past 10 years. The fund has a dividend yield of 0.56% with an expense ratio of 0.36%.
VNQ’s dividend yield is 1.78% higher than that of MINT (2.34% vs. 0.56%). Also, VNQ yielded on average 9.53% more per year over the past decade (11.05% vs. 1.52%). The expense ratio of VNQ is 0.24 percentage points lower than MINT’s (0.12% vs. 0.36%).
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|Vanguard Real Estate II Index||11.62%|
|American Tower Corp||7.24%|
|Crown Castle International Corp||5.01%|
|Simon Property Group Inc||2.52%|
|Digital Realty Trust Inc||2.49%|
|SBA Communications Corp||2.1%|
VNQ’s Top Holdings are Vanguard Real Estate II Index, American Tower Corp, Prologis Inc, Crown Castle International Corp, and Equinix Inc at 11.62%, 7.24%, 5.33%, 5.01%, and 4.3%.
Public Storage (2.85%), Simon Property Group Inc (2.52%), and Digital Realty Trust Inc (2.49%) have a slightly smaller but still significant weight. SBA Communications Corp and Welltower Inc are also represented in the VNQ’s holdings at 2.1% and 2.09%.
|MINT Bond Sectors||Weight|
MINT’s Top Bond Sectors are ratings of Others, Below B, B, BB, and BBB at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%. The fund is less weighted towards A (0.0%), AA (0.0%), and AAA (0.0%) rated bonds.
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The Vanguard Real Estate Index Fund ETF Shares (VNQ) has a Sharpe Ratio of 0.62 with a Alpha of 2.47 and a Beta of 0.76. Its Standard Deviation is 16.13 while VNQ’s Mean Return is 0.89. Furthermore, the fund has a Treynor Ratio of 11.9 and a R-squared of 44.4.
The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) has a Treynor Ratio of 10.8 with a R-squared of 4.7 and a Standard Deviation of 1.08. Its Alpha is 0.62 while MINT’s Mean Return is 0.12. Furthermore, the fund has a Sharpe Ratio of 0.78 and a Beta of 0.08.
VNQ’s Mean Return is 0.77 points higher than that of MINT and its R-squared is 39.70 points higher. With a Standard Deviation of 16.13, VNQ is slightly more volatile than MINT. The Alpha and Beta of VNQ are 1.85 points higher and 0.68 points higher than MINT’s Alpha and Beta.
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VNQ had its best year in 2014 with an annual return of 30.29%. VNQ’s worst year over the past decade yielded -5.95% and occurred in 2018. In most years the Vanguard Real Estate Index Fund ETF Shares provided moderate returns such as in 2017, 2016, and 2011 where annual returns amounted to 4.95%, 8.53%, and 8.62% respectively.
The year 2019 was the strongest year for MINT, returning 3.3% on an annual basis. The poorest year for MINT in the last ten years was 2011, with a yield of 0.42%. Most years the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund has given investors modest returns, such as in 2020, 2018, and 2010, when gains were 1.63%, 1.72%, and 1.72% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in VNQ would have resulted in a final balance of $22,973. This is a profit of $12,973 over 10 years and amounts to a compound annual growth rate (CAGR) of 11.05%.
With a $10,000 investment in MINT, the end total would have been $11,624. This equates to a $1,624 profit over 10 years and a compound annual growth rate (CAGR) of 1.52%.
VNQ’s CAGR is 9.53 percentage points higher than that of MINT and as a result, would have yielded $11,349 more on a $10,000 investment. Thus, VNQ outperformed MINT by 9.53% annually.
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