DFAR vs. VNQ

Last updated Jun 3, 2026

DFAR (Dimensional US Real Estate ETF) and VNQ (Vanguard Real Estate ETF) are both REIT funds. DFAR is actively managed, while VNQ is passively managed. Over the past 3 years, DFAR returned 9.65%/yr vs 9.19%/yr for VNQ. With a 0.99 correlation, they move nearly in lockstep. DFAR charges 0.19%/yr vs 0.13%/yr for VNQ.

Performance

DFAR vs. VNQ - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Dimensional US Real Estate ETF (DFAR) and Vanguard Real Estate ETF (VNQ). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, DFAR achieves a 11.51% return, which is significantly higher than VNQ's 7.96% return.

DFAR

• 1D: 0.28%
• 1M: -1.07%
• YTD: 11.51%
• 6M: 10.54%
• 1Y: 11.30%
• 3Y*: 9.65%
• 5Y*: —
• 10Y*: —

VNQ

• 1D: 0.46%
• 1M: -1.60%
• YTD: 7.96%
• 6M: 7.15%
• 1Y: 9.88%
• 3Y*: 9.19%
• 5Y*: 2.21%
• 10Y*: 5.22%

*Multi-year figures are annualized to reflect compound growth (CAGR)

DFAR vs. VNQ - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022
DFAR Dimensional US Real Estate ETF	11.51%	1.31%	5.25%	11.04%	-14.30%
VNQ Vanguard Real Estate ETF	7.96%	3.24%	4.81%	11.85%	-15.83%

Correlation

The correlation between DFAR and VNQ is 0.97 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.97
Correlation (3Y) Calculated over the trailing 3-year period	0.99
Correlation (All Time) Calculated using the full available price history since Feb 25, 2022	0.99

The correlation between DFAR and VNQ has been stable across timeframes, ranging from 0.97 to 0.99 - a consistent structural relationship.

DFAR vs. VNQ - Sectors Allocation Comparison

Sectors	DFAR	VNQ
Real Estate	99.8%	97.3%
Financial Services	0.0%	0.1%
Basic Materials	-	1.1%
Communication Services	-	0.6%
Consumer Cyclical	-	-
Consumer Defensive	-	-
Energy	-	0.1%
Healthcare	-	-
Industrials	-	0.0%
Technology	-	0.3%
Utilities	-	-

Return for Risk

DFAR vs. VNQ — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

DFAR

DFAR Risk / Return Rank: 25
DFAR Sharpe Ratio Rank: 24
DFAR Sortino Ratio Rank: 23
DFAR Omega Ratio Rank: 23
DFAR Calmar Ratio Rank: 27
DFAR Martin Ratio Rank: 29

VNQ

VNQ Risk / Return Rank: 23
VNQ Sharpe Ratio Rank: 22
VNQ Sortino Ratio Rank: 21
VNQ Omega Ratio Rank: 21
VNQ Calmar Ratio Rank: 25
VNQ Martin Ratio Rank: 27

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

DFAR vs. VNQ - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Dimensional US Real Estate ETF (DFAR) and Vanguard Real Estate ETF (VNQ). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

	DFAR	VNQ	Difference
Sharpe ratio Return per unit of total volatility	0.87	0.75	+0.11
Sortino ratio Return per unit of downside risk	1.24	1.11	+0.13
Omega ratio Gain probability vs. loss probability	1.16	1.14	+0.02
Calmar ratio Return relative to maximum drawdown	1.34	1.20	+0.14
Martin ratio Return relative to average drawdown	4.24	3.80	+0.43
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

DFAR vs. VNQ - Sharpe Ratio Comparison

The current DFAR Sharpe Ratio is 0.87, which is comparable to the VNQ Sharpe Ratio of 0.75. The chart below compares the historical Sharpe Ratios of DFAR and VNQ, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	DFAR	VNQ	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.87	0.75	+0.11
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	—	0.12	—
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	—	0.25	—
Sharpe Ratio (All Time) Calculated using the full available price history	0.15	0.26	-0.11

Drawdowns

DFAR vs. VNQ - Drawdown Comparison

The maximum DFAR drawdown since its inception was -32.27%, smaller than the maximum VNQ drawdown of -73.07%. Use the drawdown chart below to compare losses from any high point for DFAR and VNQ.

Drawdown Indicators

	DFAR	VNQ	Difference
Max Drawdown Largest peak-to-trough decline	-32.27%	-73.07%	+40.80%
Max Drawdown (1Y) Largest decline over 1 year	-8.43%	-8.34%	-0.09%
Max Drawdown (3Y) Largest decline over 3 years	-17.64%	-17.46%	-0.18%
Max Drawdown (5Y) Largest decline over 5 years	—	-34.48%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-42.40%	—
Current Drawdown Current decline from peak	-2.97%	-3.64%	+0.67%
Average Drawdown Average peak-to-trough decline	-14.23%	-13.63%	-0.60%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.67%	2.64%	+0.03%

Volatility

DFAR vs. VNQ - Volatility Comparison

Dimensional US Real Estate ETF (DFAR) and Vanguard Real Estate ETF (VNQ) have volatilities of 3.76% and 3.77%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	DFAR	VNQ	Difference
Volatility (1M) Calculated over the trailing 1-month period	3.76%	3.77%	-0.01%
Volatility (6M) Calculated over the trailing 6-month period	9.48%	9.33%	+0.15%
Volatility (1Y) Calculated over the trailing 1-year period	13.10%	13.16%	-0.06%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	19.14%	18.80%	+0.34%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	19.14%	20.70%	-1.56%

DFAR vs. VNQ - Expense Ratio Comparison

DFAR has a 0.19% expense ratio, which is higher than VNQ's 0.13% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

DFAR vs. VNQ - Dividend Comparison

DFAR's dividend yield for the trailing twelve months is around 2.77%, less than VNQ's 3.69% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
DFAR Dimensional US Real Estate ETF	2.77%	2.97%	2.89%	3.06%	1.69%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
VNQ Vanguard Real Estate ETF	3.69%	3.92%	3.85%	3.95%	3.91%	2.56%	3.93%	3.39%	4.74%	4.23%	4.82%	3.92%

Frequently Asked Questions

Can I hold both DFAR and VNQ in my portfolio?

With a correlation of 0.97, DFAR and VNQ move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, DFAR or VNQ?

VNQ has higher volatility (3.77%) compared to DFAR (3.76%). In terms of maximum drawdown, DFAR dropped -32.27% vs VNQ's -73.07%.

Which ETF is better, DFAR or VNQ?

On 3-year performance, DFAR leads with 9.65% vs 9.19% for VNQ. On fees, VNQ is cheaper at 0.13% per year. Their volatility is very similar. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, DFAR or VNQ?

Over the 3-year period, DFAR has performed better with a 9.65% return vs 9.19%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, DFAR or VNQ?

VNQ is cheaper with a 0.13% expense ratio, compared with 0.19% for DFAR.

Which ETF pays a higher dividend yield, DFAR or VNQ?

VNQ has the higher dividend yield at 3.69%, compared with 2.77% for DFAR.

What is the main difference between DFAR and VNQ?

They also come from different issuers: Dimensional and Vanguard. Their fees differ too: 0.19% for DFAR and 0.13% for VNQ.

Which has better risk-adjusted returns?

DFAR currently has the higher Sharpe Ratio (0.87 vs 0.75), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.