REIT vs. VNQ

Last updated Jun 24, 2026

REIT (ALPS Active REIT ETF) and VNQ (Vanguard Real Estate ETF) are both REIT funds. REIT is actively managed, while VNQ is passively managed. Over the past 5 years, REIT returned 4.91%/yr vs 2.83%/yr for VNQ. Their correlation of 0.94 suggests significant overlap in exposure. REIT charges 0.68%/yr vs 0.13%/yr for VNQ.

Performance

REIT vs. VNQ - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in ALPS Active REIT ETF (REIT) 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, REIT achieves a 17.16% return, which is significantly higher than VNQ's 11.77% return.

REIT

• 1D: 1.28%
• 1M: 1.64%
• YTD: 17.16%
• 6M: 17.61%
• 1Y: 16.74%
• 3Y*: 12.73%
• 5Y*: 4.91%
• 10Y*: —

VNQ

• 1D: 1.31%
• 1M: 1.13%
• YTD: 11.77%
• 6M: 12.16%
• 1Y: 11.59%
• 3Y*: 11.30%
• 5Y*: 2.83%
• 10Y*: 5.44%

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

REIT vs. VNQ - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021
REIT ALPS Active REIT ETF	17.16%	-0.55%	7.11%	13.74%	-21.23%	33.02%
VNQ Vanguard Real Estate ETF	11.77%	3.24%	4.81%	11.85%	-26.25%	33.86%

Correlation

The correlation between REIT and VNQ is 0.95 - 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	0.95
Correlation (3Y) Calculated over the trailing 3-year period	0.96
Correlation (5Y) Calculated over the trailing 5-year period	0.95
Correlation (All Time) Calculated using the full available price history since Feb 26, 2021	0.94

The correlation between REIT and VNQ has been stable across timeframes, ranging from 0.94 to 0.96 - a consistent structural relationship.

Return for Risk

REIT vs. VNQ — Risk / Return Rank

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

REIT

REIT Risk / Return Rank: 39
REIT Sharpe Ratio Rank: 37
REIT Sortino Ratio Rank: 34
REIT Omega Ratio Rank: 35
REIT Calmar Ratio Rank: 49
REIT Martin Ratio Rank: 42

VNQ

VNQ Risk / Return Rank: 26
VNQ Sharpe Ratio Rank: 24
VNQ Sortino Ratio Rank: 23
VNQ Omega Ratio Rank: 22
VNQ Calmar Ratio Rank: 29
VNQ Martin Ratio Rank: 31

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.

REIT vs. VNQ - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for ALPS Active REIT ETF (REIT) 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.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	REIT	VNQ	Difference
Sharpe ratio: Return per unit of total volatility	1.26	0.85	+0.41
Sortino ratio: Return per unit of downside risk	1.71	1.23	+0.48
Omega ratio: Gain probability vs. loss probability	1.22	1.15	+0.07
Calmar ratio: Return relative to maximum drawdown	2.29	1.40	+0.89
Martin ratio: Return relative to average drawdown	6.59	4.37	+2.22

REIT vs. VNQ - Sharpe Ratio Comparison

The current REIT Sharpe Ratio is 1.26, which is higher than the VNQ Sharpe Ratio of 0.85. The chart below compares the historical Sharpe Ratios of REIT 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.

Drawdowns

REIT vs. VNQ - Drawdown Comparison

The maximum REIT drawdown since its inception was -29.30%, smaller than the maximum VNQ drawdown of -73.07%. Use the drawdown chart below to compare losses from any high point for REIT and VNQ.

Drawdown Indicators

	REIT	VNQ	Difference
Max Drawdown Largest peak-to-trough decline	-29.30%	-73.07%	+43.77%
Max Drawdown (1Y) Largest decline over 1 year	-7.35%	-8.34%	+0.99%
Max Drawdown (3Y) Largest decline over 3 years	-18.19%	-17.46%	-0.73%
Max Drawdown (5Y) Largest decline over 5 years	-29.30%	-34.48%	+5.18%
Max Drawdown (10Y) Largest decline over 10 years	—	-42.40%	—
Current Drawdown Current decline from peak	-0.23%	-0.66%	+0.43%
Average Drawdown Average peak-to-trough decline	-10.28%	-13.60%	+3.32%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.54%	2.66%	-0.12%

Volatility

REIT vs. VNQ - Volatility Comparison

ALPS Active REIT ETF (REIT) and Vanguard Real Estate ETF (VNQ) have volatilities of 5.05% and 5.19%, 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

	REIT	VNQ	Difference
Volatility (1M) Calculated over the trailing 1-month period	5.05%	5.19%	-0.14%
Volatility (6M) Calculated over the trailing 6-month period	9.82%	10.20%	-0.38%
Volatility (1Y) Calculated over the trailing 1-year period	13.38%	13.84%	-0.46%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	18.51%	18.86%	-0.35%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	18.38%	20.75%	-2.37%

REIT vs. VNQ - Expense Ratio Comparison

REIT has a 0.68% expense ratio, which is higher than VNQ's 0.13% expense ratio.

Dividends

REIT vs. VNQ - Dividend Comparison

REIT's dividend yield for the trailing twelve months is around 2.72%, less than VNQ's 3.56% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
REIT ALPS Active REIT ETF	2.72%	3.20%	3.06%	3.13%	2.81%	4.71%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
VNQ Vanguard Real Estate ETF	3.56%	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 REIT and VNQ in my portfolio?

With a correlation of 0.95, REIT 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, REIT or VNQ?

VNQ has higher volatility (5.19%) compared to REIT (5.05%). In terms of maximum drawdown, REIT dropped -29.30% vs VNQ's -73.07%.

Which ETF is better, REIT or VNQ?

On 5-year performance, REIT leads with 4.91% vs 2.83% for VNQ. On fees, VNQ is cheaper at 0.13% per year. On volatility, REIT has been the lower-risk option at 5.05%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, REIT or VNQ?

Over the 5-year period, REIT has performed better with a 4.91% return vs 2.83%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, REIT or VNQ?

VNQ is cheaper with a 0.13% expense ratio, compared with 0.68% for REIT.

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

VNQ has the higher dividend yield at 3.56%, compared with 2.72% for REIT.

What is the main difference between REIT and VNQ?

They also come from different issuers: ALPS and Vanguard. Their fees differ too: 0.68% for REIT and 0.13% for VNQ.

Which has better risk-adjusted returns?

REIT currently has the higher Sharpe Ratio (1.26 vs 0.85), 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.