The Vanguard Total International Stock Index Fund ETF Shares (VXUS) and the SPDR S&P Dividend ETF (SDY) are both among the Top 100 ETFs. VXUS is a Vanguard Foreign Large Blend fund and SDY is a SPDR State Street Global Advisors Large Value fund. So, what’s the difference between VXUS and SDY? And which fund is better?
The expense ratio of VXUS is 0.27 percentage points lower than SDY’s (0.08% vs. 0.35%). VXUS also has a higher exposure to the financial services sector and a higher standard deviation. Overall, VXUS has provided lower returns than SDY over the past ten years.
In this article, we’ll compare VXUS vs. SDY. We’ll look at annual returns and performance, as well as at their industry exposure and portfolio growth. Moreover, I’ll also discuss VXUS’s and SDY’s risk metrics, fund composition, and holdings and examine how these affect their overall returns.
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|Name||Vanguard Total International Stock Index Fund ETF Shares||SPDR S&P Dividend ETF|
|Category||Foreign Large Blend||Large Value|
|Issuer||Vanguard||SPDR State Street Global Advisors|
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) is a Foreign Large Blend fund that is issued by Vanguard. It currently has 404.73B total assets under management and has yielded an average annual return of 8.41% over the past 10 years. The fund has a dividend yield of 2.44% with an expense ratio of 0.08%.
The SPDR S&P Dividend ETF (SDY) is a Large Value fund that is issued by SPDR State Street Global Advisors. It currently has 19.67B total assets under management and has yielded an average annual return of 12.44% over the past 10 years. The fund has a dividend yield of 2.65% with an expense ratio of 0.35%.
VXUS’s dividend yield is 0.21% lower than that of SDY (2.44% vs. 2.65%). Also, VXUS yielded on average 4.03% less per year over the past decade (8.41% vs. 12.44%). The expense ratio of VXUS is 0.27 percentage points lower than SDY’s (0.08% vs. 0.35%).
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The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has the most exposure to the Financial Services sector at 17.64%. This is followed by Technology and Industrials at 13.07% and 12.94% respectively. Real Estate (3.79%), Energy (4.55%), and Communication Services (7.06%) only make up 15.40% of the fund’s total assets.
VXUS’s mid-section with moderate exposure is comprised of Consumer Defensive, Basic Materials, Healthcare, Consumer Cyclical, and Industrials stocks at 7.83%, 8.37%, 9.19%, 12.64%, and 12.94%.
The SPDR S&P Dividend ETF (SDY) has the most exposure to the Financial Services sector at 16.32%. This is followed by Industrials and Consumer Defensive at 15.89% and 14.01% respectively. Communication Services (4.64%), Energy (5.95%), and Basic Materials (6.45%) only make up 17.04% of the fund’s total assets.
SDY’s mid-section with moderate exposure is comprised of Real Estate, Healthcare, Consumer Cyclical, Utilities, and Consumer Defensive stocks at 6.57%, 7.35%, 8.68%, 12.14%, and 14.01%.
VXUS is 1.32% more exposed to the Financial Services sector than SDY (17.64% vs 16.32%). VXUS’s exposure to Technology and Industrials stocks is 11.07% higher and 2.95% lower respectively (13.07% vs. 2.0% and 12.94% vs. 15.89%). In total, Real Estate, Energy, and Communication Services also make up 1.76% less of the fund’s holdings compared to SDY (15.40% vs. 17.16%).
|Taiwan Semiconductor Manufacturing Co Ltd||1.62%|
|Tencent Holdings Ltd||1.41%|
|Alibaba Group Holding Ltd Ordinary Shares||1.26%|
|Samsung Electronics Co Ltd||1.05%|
|ASML Holding NV||0.86%|
|Roche Holding AG||0.81%|
|Toyota Motor Corp||0.67%|
|LVMH Moet Hennessy Louis Vuitton SE||0.61%|
VXUS’s Top Holdings are Taiwan Semiconductor Manufacturing Co Ltd, Tencent Holdings Ltd, Alibaba Group Holding Ltd Ordinary Shares, Nestle SA, and Samsung Electronics Co Ltd at 1.62%, 1.41%, 1.26%, 1.1%, and 1.05%.
ASML Holding NV (0.86%), Roche Holding AG (0.81%), and Toyota Motor Corp (0.67%) have a slightly smaller but still significant weight. LVMH Moet Hennessy Louis Vuitton SE and Novartis AG are also represented in the VXUS’s holdings at 0.61% and 0.6%.
|Exxon Mobil Corp||2.81%|
|South Jersey Industries Inc||2.22%|
|International Business Machines Corp||2.0%|
|National Retail Properties Inc||1.86%|
|Federal Realty Investment Trust||1.77%|
|Realty Income Corp||1.7%|
|Old Republic International Corp||1.65%|
SDY’s Top Holdings are Exxon Mobil Corp, AT&T Inc, South Jersey Industries Inc, Chevron Corp, and International Business Machines Corp at 2.81%, 2.5%, 2.22%, 2.02%, and 2.0%.
AbbVie Inc (1.93%), National Retail Properties Inc (1.86%), and Federal Realty Investment Trust (1.77%) have a slightly smaller but still significant weight. Realty Income Corp and Old Republic International Corp are also represented in the SDY’s holdings at 1.7% and 1.65%.
The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has a Standard Deviation of 15.12 with a R-squared of 98.39 and a Mean Return of 0.56. Its Beta is 0.99 while VXUS’s Sharpe Ratio is 0.4. Furthermore, the fund has a Alpha of 0.31 and a Treynor Ratio of 5.14.
The SPDR S&P Dividend ETF (SDY) has a Mean Return of 1.07 with a Sharpe Ratio of 0.95 and a R-squared of 83.62. Its Standard Deviation is 12.9 while SDY’s Beta is 0.87. Furthermore, the fund has a Treynor Ratio of 13.94 and a Alpha of -0.1.
VXUS’s Mean Return is 0.51 points lower than that of SDY and its R-squared is 14.77 points higher. With a Standard Deviation of 15.12, VXUS is slightly more volatile than SDY. The Alpha and Beta of VXUS are 0.41 points higher and 0.12 points higher than SDY’s Alpha and Beta.
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VXUS had its best year in 2017 with an annual return of 27.52%. VXUS’s worst year over the past decade yielded -14.42% and occurred in 2018. In most years the Vanguard Total International Stock Index Fund ETF Shares provided moderate returns such as in 2010, 2016, and 2020 where annual returns amounted to 0.0%, 4.72%, and 11.32% respectively.
The year 2013 was the strongest year for SDY, returning 30.09% on an annual basis. The poorest year for SDY in the last ten years was 2018, with a yield of -2.73%. Most years the SPDR S&P Dividend ETF has given investors modest returns, such as in 2012, 2014, and 2017, when gains were 11.51%, 13.8%, and 15.84% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
A $10,000 investment in VXUS would have resulted in a final balance of $19,315. This is a profit of $9,315 over 9 years and amounts to a compound annual growth rate (CAGR) of 8.41%.
With a $10,000 investment in SDY, the end total would have been $27,871. This equates to a $17,871 profit over 9 years and a compound annual growth rate (CAGR) of 12.44%.
VXUS’s CAGR is 4.03 percentage points lower than that of SDY and as a result, would have yielded $8,556 less on a $10,000 investment. Thus, VXUS performed worse than SDY by 4.03% annually.
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