FXO vs. VFH

Last updated Jun 3, 2026

FXO (First Trust Financials AlphaDEX Fund) and VFH (Vanguard Financials ETF) are both Financials Equities funds - FXO tracks the StrataQuant Financials Index while VFH tracks the MSCI US Investable Market Financials 25/50 Index. Both are passively managed. Over the past 10 years, FXO returned 11.99%/yr vs 12.35%/yr for VFH. Their correlation of 0.91 suggests significant overlap in exposure. FXO charges 0.62%/yr vs 0.10%/yr for VFH.

Performance

FXO vs. VFH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in First Trust Financials AlphaDEX Fund (FXO) and Vanguard Financials ETF (VFH). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, FXO achieves a -2.21% return, which is significantly higher than VFH's -5.08% return. Both investments have delivered pretty close results over the past 10 years, with FXO having a 11.99% annualized return and VFH not far ahead at 12.35%.

FXO

• 1D: 0.39%
• 1M: -1.93%
• YTD: -2.21%
• 6M: 0.50%
• 1Y: 10.94%
• 3Y*: 19.29%
• 5Y*: 7.68%
• 10Y*: 11.99%

VFH

• 1D: 0.06%
• 1M: -1.06%
• YTD: -5.08%
• 6M: -1.24%
• 1Y: 4.26%
• 3Y*: 19.00%
• 5Y*: 8.17%
• 10Y*: 12.35%

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

FXO vs. VFH - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
FXO First Trust Financials AlphaDEX Fund	-2.21%	13.59%	27.72%	9.28%	-9.24%	37.76%	5.95%	26.31%	-11.72%	17.88%
VFH Vanguard Financials ETF	-5.08%	14.91%	30.44%	14.17%	-12.31%	35.22%	-1.96%	31.57%	-13.52%	19.99%

Correlation

The correlation between FXO and VFH is 0.92, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.92
Correlation (3Y) Calculated over the trailing 3-year period	0.93
Correlation (5Y) Calculated over the trailing 5-year period	0.95
Correlation (10Y) Calculated over the trailing 10-year period	0.95
Correlation (All Time) Calculated using the full available price history since May 11, 2007	0.91

The correlation between FXO and VFH has been stable across timeframes, ranging from 0.91 to 0.95 - a consistent structural relationship.

FXO vs. VFH - Sectors Allocation Comparison

Sectors	FXO	VFH
Financial Services	94.3%	96.8%
Real Estate	5.1%	0.8%
Technology	0.6%	2.1%
Basic Materials	-	-
Communication Services	-	0.0%
Consumer Cyclical	-	0.0%
Consumer Defensive	-	-
Energy	-	-
Healthcare	-	0.1%
Industrials	-	0.2%
Utilities	-	-

Return for Risk

FXO vs. VFH — Risk / Return Rank

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

FXO

FXO Risk / Return Rank: 21
FXO Sharpe Ratio Rank: 21
FXO Sortino Ratio Rank: 20
FXO Omega Ratio Rank: 20
FXO Calmar Ratio Rank: 21
FXO Martin Ratio Rank: 22

VFH

VFH Risk / Return Rank: 12
VFH Sharpe Ratio Rank: 13
VFH Sortino Ratio Rank: 12
VFH Omega Ratio Rank: 12
VFH Calmar Ratio Rank: 12
VFH Martin Ratio Rank: 12

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.

FXO vs. VFH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for First Trust Financials AlphaDEX Fund (FXO) and Vanguard Financials ETF (VFH). 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.

	FXO	VFH	Difference
Sharpe ratio Return per unit of total volatility	0.71	0.29	+0.41
Sortino ratio Return per unit of downside risk	1.05	0.49	+0.56
Omega ratio Gain probability vs. loss probability	1.13	1.06	+0.07
Calmar ratio Return relative to maximum drawdown	0.94	0.30	+0.64
Martin ratio Return relative to average drawdown	2.83	0.79	+2.04
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

FXO vs. VFH - Sharpe Ratio Comparison

The current FXO Sharpe Ratio is 0.71, which is higher than the VFH Sharpe Ratio of 0.29. The chart below compares the historical Sharpe Ratios of FXO and VFH, 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

	FXO	VFH	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.71	0.29	+0.41
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.35	0.43	-0.07
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.50	0.55	-0.05
Sharpe Ratio (All Time) Calculated using the full available price history	0.31	0.24	+0.06

Drawdowns

FXO vs. VFH - Drawdown Comparison

The maximum FXO drawdown since its inception was -71.30%, smaller than the maximum VFH drawdown of -78.61%. Use the drawdown chart below to compare losses from any high point for FXO and VFH.

Drawdown Indicators

	FXO	VFH	Difference
Max Drawdown Largest peak-to-trough decline	-71.30%	-78.61%	+7.31%
Max Drawdown (1Y) Largest decline over 1 year	-11.72%	-14.75%	+3.03%
Max Drawdown (3Y) Largest decline over 3 years	-21.35%	-17.30%	-4.05%
Max Drawdown (5Y) Largest decline over 5 years	-28.80%	-25.66%	-3.14%
Max Drawdown (10Y) Largest decline over 10 years	-48.55%	-44.42%	-4.13%
Current Drawdown Current decline from peak	-5.14%	-7.96%	+2.82%
Average Drawdown Average peak-to-trough decline	-13.12%	-18.54%	+5.42%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.89%	5.52%	-1.63%

Volatility

FXO vs. VFH - Volatility Comparison

First Trust Financials AlphaDEX Fund (FXO) has a higher volatility of 3.61% compared to Vanguard Financials ETF (VFH) at 3.12%. This indicates that FXO's price experiences larger fluctuations and is considered to be riskier than VFH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	FXO	VFH	Difference
Volatility (1M) Calculated over the trailing 1-month period	3.61%	3.12%	+0.49%
Volatility (6M) Calculated over the trailing 6-month period	10.69%	11.03%	-0.34%
Volatility (1Y) Calculated over the trailing 1-year period	15.58%	14.72%	+0.86%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	21.95%	19.30%	+2.65%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.13%	22.54%	+1.59%

FXO vs. VFH - Expense Ratio Comparison

FXO has a 0.62% expense ratio, which is higher than VFH's 0.10% expense ratio.

Dividends

FXO vs. VFH - Dividend Comparison

FXO's dividend yield for the trailing twelve months is around 2.21%, more than VFH's 1.54% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FXO First Trust Financials AlphaDEX Fund	2.21%	1.78%	1.97%	2.98%	2.49%	1.91%	2.60%	1.72%	2.60%	1.62%	1.35%	1.51%
VFH Vanguard Financials ETF	1.54%	1.55%	1.75%	2.08%	2.31%	1.87%	2.21%	2.17%	2.30%	1.53%	1.63%	2.00%

Frequently Asked Questions

Can I hold both FXO and VFH in my portfolio?

With a correlation of 0.92, FXO and VFH 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, FXO or VFH?

FXO has higher volatility (3.61%) compared to VFH (3.12%). In terms of maximum drawdown, FXO dropped -71.30% vs VFH's -78.61%.

Which ETF is better, FXO or VFH?

On 10-year performance, VFH leads with 12.35% vs 11.99% for FXO. On fees, VFH is cheaper at 0.10% per year. On volatility, VFH has been the lower-risk option at 3.12%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, FXO or VFH?

Over the 10-year period, VFH has performed better with a 12.35% return vs 11.99%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, FXO or VFH?

VFH is cheaper with a 0.10% expense ratio, compared with 0.62% for FXO.

Which ETF pays a higher dividend yield, FXO or VFH?

FXO has the higher dividend yield at 2.21%, compared with 1.54% for VFH.

What is the main difference between FXO and VFH?

FXO tracks StrataQuant Financials Index, while VFH tracks MSCI US Investable Market Financials 25/50 Index. They also come from different issuers: First Trust and Vanguard. Their fees differ too: 0.62% for FXO and 0.10% for VFH.

Which has better risk-adjusted returns?

FXO currently has the higher Sharpe Ratio (0.71 vs 0.29), 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.