FXZ vs. VAW

Last updated Jun 4, 2026

FXZ (First Trust Materials AlphaDEX Fund) and VAW (Vanguard Materials ETF) are both Materials funds - FXZ tracks the StrataQuant Materials Index while VAW tracks the MSCI US Investable Market Materials 25/50 Index. Both are passively managed. Over the past 10 years, FXZ returned 11.67%/yr vs 10.35%/yr for VAW. Their correlation of 0.91 suggests significant overlap in exposure. FXZ charges 0.67%/yr vs 0.10%/yr for VAW.

Performance

FXZ vs. VAW - Performance Comparison

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

Returns By Period

In the year-to-date period, FXZ achieves a 29.62% return, which is significantly higher than VAW's 13.17% return. Over the past 10 years, FXZ has outperformed VAW with an annualized return of 11.67%, while VAW has yielded a comparatively lower 10.35% annualized return.

FXZ

• 1D: -0.40%
• 1M: 5.70%
• YTD: 29.62%
• 6M: 33.34%
• 1Y: 53.31%
• 3Y*: 13.07%
• 5Y*: 7.84%
• 10Y*: 11.67%

VAW

• 1D: -0.23%
• 1M: 2.57%
• YTD: 13.17%
• 6M: 16.23%
• 1Y: 22.68%
• 3Y*: 12.47%
• 5Y*: 5.80%
• 10Y*: 10.35%

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

FXZ vs. VAW - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
FXZ First Trust Materials AlphaDEX Fund	29.62%	16.25%	-16.31%	16.27%	-0.92%	30.84%	22.52%	21.52%	-22.62%	23.72%
VAW Vanguard Materials ETF	13.17%	12.30%	0.48%	13.67%	-11.80%	27.43%	19.44%	23.53%	-17.49%	23.76%

Correlation

The correlation between FXZ and VAW is 0.94, 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	0.94
Correlation (3Y) Calculated over the trailing 3-year period	0.92
Correlation (5Y) Calculated over the trailing 5-year period	0.93
Correlation (10Y) Calculated over the trailing 10-year period	0.93
Correlation (All Time) Calculated using the full available price history since May 11, 2007	0.91

The correlation between FXZ and VAW has been stable across timeframes, ranging from 0.91 to 0.94 - a consistent structural relationship.

FXZ vs. VAW - Sectors Allocation Comparison

Sectors	FXZ	VAW
Basic Materials	75.7%	90.2%
Industrials	20.4%	1.0%
Consumer Cyclical	3.9%	8.3%
Communication Services	-	-
Consumer Defensive	-	0.0%
Energy	-	0.5%
Financial Services	-	-
Healthcare	-	0.5%
Real Estate	-	-
Technology	-	0.1%
Utilities	-	-

Return for Risk

FXZ vs. VAW — Risk / Return Rank

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

FXZ

FXZ Risk / Return Rank: 74
FXZ Sharpe Ratio Rank: 75
FXZ Sortino Ratio Rank: 70
FXZ Omega Ratio Rank: 66
FXZ Calmar Ratio Rank: 81
FXZ Martin Ratio Rank: 80

VAW

VAW Risk / Return Rank: 34
VAW Sharpe Ratio Rank: 35
VAW Sortino Ratio Rank: 34
VAW Omega Ratio Rank: 33
VAW Calmar Ratio Rank: 34
VAW Martin Ratio Rank: 35

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.

FXZ vs. VAW - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for First Trust Materials AlphaDEX Fund (FXZ) and Vanguard Materials ETF (VAW). 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.

	FXZ	VAW	Difference
Sharpe ratio: Return per unit of total volatility	2.45	1.29	+1.16
Sortino ratio: Return per unit of downside risk	3.21	1.86	+1.35
Omega ratio: Gain probability vs. loss probability	1.40	1.22	+0.18
Calmar ratio: Return relative to maximum drawdown	4.20	1.70	+2.50
Martin ratio: Return relative to average drawdown	15.80	5.56	+10.24
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

FXZ vs. VAW - Sharpe Ratio Comparison

The current FXZ Sharpe Ratio is 2.45, which is higher than the VAW Sharpe Ratio of 1.29. The chart below compares the historical Sharpe Ratios of FXZ and VAW, 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

	FXZ	VAW	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.45	1.29	+1.16
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.33	0.30	+0.03
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.47	0.49	-0.02
Sharpe Ratio (All Time) Calculated using the full available price history	0.35	0.39	-0.04

Drawdowns

FXZ vs. VAW - Drawdown Comparison

The maximum FXZ drawdown since its inception was -65.46%, which is greater than VAW's maximum drawdown of -62.17%. Use the drawdown chart below to compare losses from any high point for FXZ and VAW.

Drawdown Indicators

	FXZ	VAW	Difference
Max Drawdown Largest peak-to-trough decline	-65.46%	-62.17%	-3.29%
Max Drawdown (1Y) Largest decline over 1 year	-12.75%	-13.42%	+0.67%
Max Drawdown (3Y) Largest decline over 3 years	-33.99%	-23.21%	-10.78%
Max Drawdown (5Y) Largest decline over 5 years	-33.99%	-25.50%	-8.49%
Max Drawdown (10Y) Largest decline over 10 years	-49.41%	-41.13%	-8.28%
Current Drawdown Current decline from peak	-0.40%	-3.79%	+3.39%
Average Drawdown Average peak-to-trough decline	-11.36%	-9.63%	-1.73%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.38%	4.09%	-0.71%

Volatility

FXZ vs. VAW - Volatility Comparison

First Trust Materials AlphaDEX Fund (FXZ) has a higher volatility of 7.04% compared to Vanguard Materials ETF (VAW) at 6.08%. This indicates that FXZ's price experiences larger fluctuations and is considered to be riskier than VAW based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	FXZ	VAW	Difference
Volatility (1M) Calculated over the trailing 1-month period	7.04%	6.08%	+0.96%
Volatility (6M) Calculated over the trailing 6-month period	16.40%	13.93%	+2.47%
Volatility (1Y) Calculated over the trailing 1-year period	21.87%	17.65%	+4.22%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	24.13%	19.62%	+4.51%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.87%	21.20%	+3.67%

FXZ vs. VAW - Expense Ratio Comparison

FXZ has a 0.67% expense ratio, which is higher than VAW's 0.10% expense ratio.

Dividends

FXZ vs. VAW - Dividend Comparison

FXZ's dividend yield for the trailing twelve months is around 1.38%, more than VAW's 1.36% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FXZ First Trust Materials AlphaDEX Fund	1.38%	1.74%	1.81%	1.97%	1.56%	1.11%	1.51%	1.58%	1.38%	1.01%	1.19%	1.26%
VAW Vanguard Materials ETF	1.36%	1.55%	1.70%	1.72%	1.98%	1.44%	1.67%	1.94%	2.03%	1.63%	1.67%	2.30%

Frequently Asked Questions

Can I hold both FXZ and VAW in my portfolio?

With a correlation of 0.94, FXZ and VAW 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, FXZ or VAW?

FXZ has higher volatility (7.04%) compared to VAW (6.08%). In terms of maximum drawdown, FXZ dropped -65.46% vs VAW's -62.17%.

Which ETF is better, FXZ or VAW?

On 10-year performance, FXZ leads with 11.67% vs 10.35% for VAW. On fees, VAW is cheaper at 0.10% per year. On volatility, VAW has been the lower-risk option at 6.08%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, FXZ or VAW?

Over the 10-year period, FXZ has performed better with a 11.67% return vs 10.35%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, FXZ or VAW?

VAW is cheaper with a 0.10% expense ratio, compared with 0.67% for FXZ.

Which ETF pays a higher dividend yield, FXZ or VAW?

FXZ has the higher dividend yield at 1.38%, compared with 1.36% for VAW.

What is the main difference between FXZ and VAW?

FXZ tracks StrataQuant Materials Index, while VAW tracks MSCI US Investable Market Materials 25/50 Index. They also come from different issuers: First Trust and Vanguard. Their fees differ too: 0.67% for FXZ and 0.10% for VAW.

Which has better risk-adjusted returns?

FXZ currently has the higher Sharpe Ratio (2.45 vs 1.29), 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.