• Skip to main content
  • Skip to secondary menu
  • Skip to primary sidebar
  • Skip to footer

Optimized Portfolio

Investing and Personal Finance

  • Start Here
  • Investing 101
    • Beginners Start Here – 10 Steps To Start Building Wealth
    • What Is the Stock Market? How It Works & How to Invest in It
    • How To Invest in an Index Fund – The Best Index Funds
    • Portfolio Asset Allocation by Age
    • How To Invest Your Emergency Fund
    • Portfolio Diversification – How To Diversify Your Portfolio
    • Dollar Cost Averaging vs. Lump Sum Investing (DCA vs. LSI)
    • How To Invest Your HSA (Health Savings Account)
    • Factor Investing and Factor ETFs – The Ultimate Guide
    • more…
  • Lazy Portfolios
    • All Weather Portfolio
    • Bogleheads 3 Fund Portfolio
    • HEDGEFUNDIE’s Excellent Adventure
    • Warren Buffett Portfolio
    • Golden Butterfly Portfolio
    • Paul Merriman Ultimate Buy and Hold Portfolio
    • Ben Felix Model Portfolio
    • Permanent Portfolio
    • David Swensen Portfolio
    • 60/40 Portfolio
    • more…
  • Funds
    • VOO vs. VTI – Vanguard S&P 500 or Total Stock Market ETF?
    • The 7 Best International ETFs
    • The 8 Best Small Cap ETFs (4 From Vanguard)
    • The 5 Best REIT ETFs
    • The 5 Best EV ETFs – Electric Vehicles ETFs
    • VIG vs. VYM – Comparing Vanguard’s 2 Popular Dividend ETF’s
    • The Best Vanguard Dividend Funds – 4 Popular ETFs
    • The 5 Best Tech ETFs
    • The 7 Best Small Cap Value ETFs
    • The 6 Best ETFs for Taxable Accounts
    • The 5 Best Emerging Markets ETFs (1 From Vanguard) for 2023
    • more…
  • Leverage
    • What Is a Leveraged ETF and How Do They Work?
    • How To Beat the Market Using Leverage and Index Investing
    • The 9 Best Leveraged ETFs
    • Hedgefundie’s Excellent Adventure
    • Leveraged All Weather Portfolio
    • Leveraged Permanent Portfolio
    • Leveraged Golden Butterfly Portfolio
    • NTSX – Review and Summary
    • TQQQ – Is It A Good Investment?
    • PSLDX – A Review
    • SWAN – A Review
    • RPAR Risk Parity ETF Review
    • more…
  • Dividends
    • The Best M1 Finance Dividend Pie
    • The 11 Best Dividend ETFs
    • The Best Vanguard Dividend Funds – 4 Popular ETFs
    • VIG vs. VYM – Comparing Vanguard’s 2 Popular Dividend ETF’s
    • 8 Reasons Why I’m Not a Dividend Income Investor
    • QYLD – A Harsh Review
    • more…
  • Brokers
    • The 5 Best Stock Brokers
    • The 4 Best Investing Apps
    • M1 Finance Review
    • Brokers with the Lowest Margin Rates
    • M1 Finance vs. Fidelity
    • M1 Finance vs. Vanguard
    • Webull vs. Robinhood
    • Stash vs. Robinhood
    • M1 Borrow Review (How M1’s Margin Loan Works)
    • more…
  • Retirement
    • The 10 Best ETFs for Retirement Portfolios in 2023
    • The 4% Rule for Retirement Withdrawal Rate – A Revisitation
    • Sequence of Return Risk in Retirement Explained
    • Traditional IRA Explained
    • Roth IRA Explained
    • 401k vs. Roth IRA
    • Roth IRA vs. Traditional IRA
    • Backdoor Roth IRA Explained
    • more…
  • My Toolbox

VYM vs. VOO & VTI from Vanguard – Dividends vs. Broad Market

Last Updated: August 13, 2022 5 Comments – 3 min. read

VYM is Vanguard's dividend-yield-oriented ETF. VOO and VTI are their broad market index funds for the S&P 500 and total U.S. stock market. Let's compare them.

In a hurry? Here are the highlights:

  • VYM, VOO, and VTI are all very popular U.S. stock funds from Vanguard.
  • VYM tracks the FTSE High Dividend Yield Index. VOO tracks the S&P 500 Index. VTI tracks the CRSP US Total Market Index.
  • As such, VYM is solely U.S. large cap dividend stocks (all Value, no Growth), VOO is U.S. large-cap stocks across both Growth and Value, and VTI is essentially VOO plus small- and mid-cap stocks.
  • VOO and VTI include REITs; VYM does not.
  • VOO and VTI are much more diversified than VYM.
  • VOO and VTI have significantly outperformed VYM going back to VYM's inception in 2006. In fairness, the Value premium has suffered greatly over that time period. Historical performance of VTI and VOO has been nearly identical.
  • VOO and VTI are more popular and slightly cheaper than VYM.
  • VYM is likely unsuitable as a core holding in a well-diversified investment portfolio.

Contents

  • Video
  • VYM vs. VOO and VTI – Methodology and Composition
  • VYM vs. VOO and VTI – Historical Performance
  • VYM vs. VOO and VTI – AUM and Fees
  • Conclusion

Video

Prefer video? Watch it here:

VYM vs. VOO and VTI – Methodology and Composition

We can compare VYM to both VOO and VTI at the same time, as both VOO and VTI capture “the market” in the U.S. and perform nearly identically; VOO is the S&P 500 and VTI is the total U.S. stock market. I delved into comparing VOO and VTI here.

VYM, established in 2006, is a narrower segment of the market. It is the Vanguard High Dividend Yield ETF. It has about 400 holdings. As the name suggests, the fund holds large-cap U.S. stocks with a high dividend yield. Specifically, the fund seeks to track the FTSE High Dividend Yield Index.

The index is market cap weighted, and attempts to forecast dividend yield. REITs are excluded. Stocks forecasted to have no dividend yield or that haven't paid a dividend in the past 12 months are also excluded. As such, VYM is entirely exposed to large cap value; it has no exposure to large cap growth stocks, as they tend to not pay a dividend.

Sector weightings are naturally very different for VYM than for VOO or VTI. Thus, VYM alone would not be sufficient as a core holding for a diversified investment portfolio, and should probably only be used to tilt, or overweight, high dividend stocks in one's portfolio. This may be attractive for dividend investors; I'm not a dividend investor, but I did design a dividend-focused portfolio that incorporates VYM.

VOO is the Vanguard S&P 500 ETF. Established in 2010, it is one of the most popular ETFs out there. The fund seeks to track the S&P 500 Index, holding over 500 U.S. large-cap stocks, weighted by market capitalization. This index is considered a barometer for the U.S. stock market. VOO is roughly half large cap value and half large cap growth. As such, it is more diversified than VYM.

VTI is the Vanguard Total Stock Market ETF. It was established in 2001. VTI provides similar broad exposure to the U.S. stock market, but also includes small- and mid-cap stocks. Specifically, VTI is about 82% large cap stocks, 12% mid cap stocks, and 6% small cap stocks.

The fund seeks to track the CRSP US Total Market Index. This ETF has over 3,500 holdings. Consequently, VTI can be considered more diversified than VOO.

All three of these funds only hold stocks in the United States. Both VOO and VTI include REITs, while VYM does not.

VYM vs. VOO and VTI – Historical Performance

Going back to 2006 when VYM was incepted, VOO and VTI have beaten it handily:

vym vs voo and vti
Source: PortfolioVisualizer.com

In fairness, we should expect this result, as VYM inherently has much more exposure to the Value factor, and the Value premium has suffered over the past decade.

VYM vs. VOO and VTI – AUM and Fees

Though all three of these funds are highly liquid and very popular, Vanguard's VOO and VTI are much more popular than VYM with over $550 billion and $900 billion in assets, respectively, compared to about $33 billion for VYM.

VYM has an expense ratio of 0.06%, while both VOO and VTI are cheaper with an expense ratio of 0.03%.

Conclusion

Investors seeking broad, diversified exposure to the U.S. stock market should use VOO or VTI as a core holding. VYM only looks at large-cap, high-dividend-yield stocks in the U.S. and is thus likely better suited as a dividend tilt for those looking to use dividend yield as income or those who want a suboptimal Value factor tilt.

VOO and VTI have outperformed VYM going back to VYM's inception in 2006, as VYM has no exposure to Growth, which has beaten Value over that time period, highlighting the importance of diversification across equity styles.

VOO and VTI are also more popular and slightly cheaper than VYM.

Conveniently, all these funds should be available at any major broker, including M1 Finance, which is the one I'm usually suggesting around here.


Disclosure: I am long VOO.

Disclaimer:  While I love diving into investing-related data and playing around with backtests, this is not financial advice, investing advice, or tax advice. The information on this website is for informational, educational, and entertainment purposes only. Investment products discussed (ETFs, mutual funds, etc.) are for illustrative purposes only. It is not a research report. It is not a recommendation to buy, sell, or otherwise transact in any of the products mentioned. I always attempt to ensure the accuracy of information presented but that accuracy cannot be guaranteed. Do your own due diligence. I mention M1 Finance a lot around here. M1 does not provide investment advice, and this is not an offer or solicitation of an offer, or advice to buy or sell any security, and you are encouraged to consult your personal investment, legal, and tax advisors. Hypothetical examples used, such as historical backtests, do not reflect any specific investments, are for illustrative purposes only, and should not be considered an offer to buy or sell any products. All investing involves risk, including the risk of losing the money you invest. Past performance does not guarantee future results. Opinions are my own and do not represent those of other parties mentioned. Read my lengthier disclaimer here.

m1


Are you nearing or in retirement? Use my link here to get a free holistic financial plan and to take advantage of 25% exclusive savings on financial planning and wealth management services from fiduciary advisors at Retirable to manage your savings, spend smarter, and navigate key decisions.

retirement peace of mind

Related Posts

  • 13 Best Index Funds for Young Investors (6 From Vanguard)
  • VIG vs. VOO & VTI – Vanguard Dividend Growth ETF vs. Broad Market
  • How To Buy Microsoft Stock With $100 – Invest in Microsoft
  • The Best Index Funds for 2025 for the Passive Investor
  • Rental Properties vs. Investing in the Stock Market – An Op-Ed

About John Williamson, APMA®

Analytical data nerd, investing enthusiast, fintech consultant, Boglehead, and Oxford comma advocate. I'm not a big fan of social media, but you can find me on LinkedIn and Reddit.

Reader Interactions

Comments

  1. Jenny says

    July 3, 2021 at 7:08 am

    I have $100k saving. I like to invest in dividend ETFs to earn some monthly income in stead of investing it in CD. I am looking at these ETFS VYM, SCHD, VOO, QQQ. Some of them are very high so I have this question.
    Should I buy SCHD @$76/share and earn $0.67 / share in dividend?
    or
    Should I buy VOO @$398/share and earn $1.33/share in dividend?
    I think the cheaper ETF prices is the better dividend income.
    However, I am sure if my thought is right.
    Can anyone please clear my thought on this?
    Thanks very much.
    Have a nice day!

    Reply
    • John Williamson says

      July 4, 2021 at 3:53 pm

      Hi Jenny. These would be very different investments. Don’t focus on the share price. Also remember dividends are not free money, so unless you’re specifically using them as income, there’s no reason to chase the yield.

      Reply
      • Julie says

        August 5, 2021 at 11:39 pm

        What does mean :“ dividends are not free money”?

        Reply
        • John Williamson says

          August 6, 2021 at 10:15 am

          Share price compensates for the dividend payment. See this post.

          Reply
    • Julie says

      August 5, 2021 at 11:44 pm

      Hi Jenny , I’m on. the same stage, too. What did you do?

      Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Primary Sidebar

  • Facebook
  • Instagram
  • Reddit
  • Twitter
  • YouTube
  • Patreon

Join 5,372 other investors

Take control of your financial future by subscribing to receive exclusive emails with expert tips, news, and notifications of new posts and important updates.

Don't worry, I hate spam too. No ads.

John Williamson, APMA®

Analytical data nerd, investing enthusiast, fintech consultant, Boglehead, and Oxford comma advocate. I'm not a big fan of social media, but you can find me on LinkedIn and Reddit. Read More…

Most Popular

Ray Dalio All Weather Portfolio Review, ETFs, & Leverage (2025)

HEDGEFUNDIE’s Excellent Adventure (UPRO/TMF) – A Summary

Golden Butterfly Portfolio Review and M1 Finance ETF Pie

David Swensen Portfolio (Yale Model) Review and ETFs To Use

55 Lazy Portfolios and Their ETF Pies for M1 Finance (2025)

VIG vs. VYM – Vanguard’s 2 Popular Dividend ETFs (Review)

Warren Buffett ETF Portfolio (90/10) Review and ETFs (2025)

Bogleheads 3 Fund Portfolio Review and Vanguard ETFs (2025)

Paul Merriman Ultimate Buy and Hold Portfolio Review & ETFs (2025)

The Best M1 Finance Dividend Pie for FIRE & Income Investors

m1 sidebar

retirable

Portfolio Asset Allocation by Age – Beginners To Retirees

The 7 Best Small Cap ETFs (3 From Vanguard) for 2025

9 Best International ETFs To Buy (6 From Vanguard) in 2025

The 3 Best Inverse ETFs to Short the S&P 500 Index in 2025

Ben Felix Model Portfolio (Rational Reminder, PWL) ETFs & Review

Factor Investing and Factor ETFs – The Ultimate Guide

NTSX ETF Review – WisdomTree U.S. Efficient Core ETF (90/60)

The Ginger Ale Portfolio (My Own Portfolio) and M1 ETF Pie

TQQQ – Is It A Good Investment for a Long Term Hold Strategy?

QYLD – Avoid This ETF as a Long-Term Investment (A Review)

The 9 Best T Bill ETFs (Treasury Bills) To Park Cash in 2025

JEPI ETF Review – JPMorgan Equity Premium Income ETF

SPAXX vs. FZFXX, FDIC, FCASH, FDRXX – Fidelity Core Position

Recent Posts

M1 Earn High Yield Cash Account Review – 4% APY (2025)

RSBY ETF Review – Return Stacked® U.S. Bonds & Futures Yield ETF

1 ETF for Life to Get Rich? It’s Not One You’d Guess…

How to Get 35% off a New Tesla Model Y (1.99% APR Financing Promo)

M1 Finance New Dividend Reinvestment Features Are Here! (Sneak Peek)

RSSY ETF Review – Return Stacked® U.S. Stocks & Futures Yield ETF

RSBT ETF Review – Return Stacked® Bonds & Managed Futures ETF

RSST ETF Review – Return Stacked® US Stocks & Managed Futures ETF

CAOS ETF Review – Alpha Architect Tail Risk ETF

How to Get 33% off a New Tesla Model Y (0.99% APR Promo)

CALF ETF Review – Pacer U.S. Small Cap Cash Cows 100 ETF

Is THIS the Best Portfolio?

AVMA ETF Review – Avantis Moderate Allocation ETF (60/40 + Factors)

COWZ ETF Review – Pacer U.S. Cash Cows 100 ETF

BOXX ETF Review – Alpha Architect 1-3 Month Box ETF

View All...

Footer

  • Facebook
  • Instagram
  • Reddit
  • Twitter
  • YouTube
  • Patreon

Amazon Affiliate Disclosure

OptimizedPortfolio.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.

Email Newsletter

Sign up to receive email updates when a new post is published.

Don't worry, I hate spam too. No ads.

About - My Toolbox - Privacy - Terms - Contact


Copyright © 2025 OptimizedPortfolio.com

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Ok, Got ItReject Read More
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary
Always Enabled
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Non-necessary
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
SAVE & ACCEPT