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VXUS vs. VV: What’s The Difference?

The Vanguard Total International Stock Index Fund ETF Shares (VXUS) and the Vanguard Large-Cap Index Fund ETF Shares (VV) are both among the Top 100 ETFs. VXUS is a Vanguard Foreign Large Blend fund and VV is a Vanguard Large Blend fund. So, what’s the difference between VXUS and VV? And which fund is better?

The expense ratio of VXUS is 0.04 percentage points higher than VV’s (0.08% vs. 0.04%). VXUS also has a higher exposure to the financial services sector and a higher standard deviation. Overall, VXUS has provided lower returns than VV over the past ten years.

In this article, we’ll compare VXUS vs. VV. We’ll look at fund composition and portfolio growth, as well as at their performance and risk metrics. Moreover, I’ll also discuss VXUS’s and VV’s holdings, annual returns, and industry exposure and examine how these affect their overall returns.

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Summary

VXUSVV
NameVanguard Total International Stock Index Fund ETF SharesVanguard Large-Cap Index Fund ETF Shares
CategoryForeign Large BlendLarge Blend
IssuerVanguardVanguard
AUM404.73B37.65B
Avg. Return8.41%14.75%
Div. Yield2.44%1.26%
Expense Ratio0.08%0.04%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) is a Large Blend fund that is issued by Vanguard. It currently has 37.65B total assets under management and has yielded an average annual return of 14.75% over the past 10 years. The fund has a dividend yield of 1.26% with an expense ratio of 0.04%.

VXUS’s dividend yield is 1.18% higher than that of VV (2.44% vs. 1.26%). Also, VXUS yielded on average 6.34% less per year over the past decade (8.41% vs. 14.75%). The expense ratio of VXUS is 0.04 percentage points higher than VV’s (0.08% vs. 0.04%).

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Fund Composition

Industry Exposure

VXUS vs. VV - Industry Exposure

VXUSVV
Technology13.07%25.38%
Industrials12.94%8.39%
Energy4.55%2.62%
Communication Services7.06%11.68%
Utilities2.94%2.35%
Healthcare9.19%13.22%
Consumer Defensive7.83%6.06%
Real Estate3.79%2.7%
Financial Services17.64%13.82%
Consumer Cyclical12.64%11.65%
Basic Materials8.37%2.13%

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 Vanguard Large-Cap Index Fund ETF Shares (VV) has the most exposure to the Technology sector at 25.38%. This is followed by Financial Services and Healthcare at 13.82% and 13.22% respectively. Utilities (2.35%), Energy (2.62%), and Real Estate (2.7%) only make up 7.67% of the fund’s total assets.

VV’s mid-section with moderate exposure is comprised of Consumer Defensive, Industrials, Consumer Cyclical, Communication Services, and Healthcare stocks at 6.06%, 8.39%, 11.65%, 11.68%, and 13.22%.

VXUS is 3.82% more exposed to the Financial Services sector than VV (17.64% vs 13.82%). VXUS’s exposure to Technology and Industrials stocks is 12.31% lower and 4.55% higher respectively (13.07% vs. 25.38% and 12.94% vs. 8.39%). In total, Real Estate, Energy, and Communication Services also make up 1.60% less of the fund’s holdings compared to VV (15.40% vs. 17.00%).

Holdings

VXUS - Holdings

VXUS HoldingsWeight
Taiwan Semiconductor Manufacturing Co Ltd1.62%
Tencent Holdings Ltd1.41%
Alibaba Group Holding Ltd Ordinary Shares1.26%
Nestle SA1.1%
Samsung Electronics Co Ltd1.05%
ASML Holding NV0.86%
Roche Holding AG0.81%
Toyota Motor Corp0.67%
LVMH Moet Hennessy Louis Vuitton SE0.61%
Novartis AG0.6%

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%.

VV - Holdings

VV HoldingsWeight
Apple Inc5.7%
Microsoft Corp5.35%
Amazon.com Inc3.87%
Facebook Inc Class A2.19%
Alphabet Inc Class A1.93%
Alphabet Inc Class C1.81%
Tesla Inc1.37%
Berkshire Hathaway Inc Class B1.3%
NVIDIA Corp1.24%
JPMorgan Chase & Co1.24%

VV’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 5.7%, 5.35%, 3.87%, 2.19%, and 1.93%.

Alphabet Inc Class C (1.81%), Tesla Inc (1.37%), and Berkshire Hathaway Inc Class B (1.3%) have a slightly smaller but still significant weight. NVIDIA Corp and JPMorgan Chase & Co are also represented in the VV’s holdings at 1.24% and 1.24%.

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Risk Analysis

VXUSVV
Mean Return0.561.24
R-squared98.3999.86
Std. Deviation15.1213.75
Alpha0.31-0.08
Beta0.991.01
Sharpe Ratio0.41.04
Treynor Ratio5.1414.14

The Vanguard Total International Stock Index Fund ETF Shares (VXUS) has a Beta of 0.99 with a Treynor Ratio of 5.14 and a Alpha of 0.31. Its Mean Return is 0.56 while VXUS’s R-squared is 98.39. Furthermore, the fund has a Standard Deviation of 15.12 and a Sharpe Ratio of 0.4.

The Vanguard Large-Cap Index Fund ETF Shares (VV) has a Standard Deviation of 13.75 with a Beta of 1.01 and a R-squared of 99.86. Its Sharpe Ratio is 1.04 while VV’s Treynor Ratio is 14.14. Furthermore, the fund has a Mean Return of 1.24 and a Alpha of -0.08.

VXUS’s Mean Return is 0.68 points lower than that of VV and its R-squared is 1.47 points lower. With a Standard Deviation of 15.12, VXUS is slightly more volatile than VV. The Alpha and Beta of VXUS are 0.39 points higher and 0.02 points lower than VV’s Alpha and Beta.

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Performance

Annual Returns

VXUS vs. VV - Annual Returns

YearVXUSVV
202011.32%20.99%
201921.58%31.39%
2018-14.42%-4.44%
201727.52%22.03%
20164.72%11.65%
2015-4.28%1.07%
2014-4.17%13.39%
201315.16%32.65%
201218.22%16.09%
20110.0%1.58%
20100.0%15.81%

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 VV, returning 32.65% on an annual basis. The poorest year for VV in the last ten years was 2018, with a yield of -4.44%. Most years the Vanguard Large-Cap Index Fund ETF Shares has given investors modest returns, such as in 2014, 2010, and 2012, when gains were 13.39%, 15.81%, and 16.09% respectively.

Portfolio Growth

VXUS vs. VV - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VXUS$10,000$19,3158.41%
VV$10,000$36,52614.75%

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 VV, the end total would have been $36,526. This equates to a $26,526 profit over 9 years and a compound annual growth rate (CAGR) of 14.75%.

VXUS’s CAGR is 6.34 percentage points lower than that of VV and as a result, would have yielded $17,211 less on a $10,000 investment. Thus, VXUS performed worse than VV by 6.34% annually.


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