VAW vs. SPY

Last updated Jun 24, 2026

VAW (Vanguard Materials ETF) and SPY (State Street SPDR S&P 500 ETF) are both exchange-traded funds - VAW is a Materials fund tracking the MSCI US Investable Market Materials 25/50 Index, while SPY is a S&P 500 fund tracking the S&P 500 Index. Both are passively managed. Over the past 10 years, VAW returned 10.46%/yr vs 15.53%/yr for SPY. A 0.79 correlation means they provide meaningful diversification when combined. VAW charges 0.09%/yr vs 0.09%/yr for SPY.

Performance

VAW vs. SPY - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Materials ETF (VAW) and State Street SPDR S&P 500 ETF (SPY). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VAW achieves a 11.07% return, which is significantly higher than SPY's 8.15% return. Over the past 10 years, VAW has underperformed SPY with an annualized return of 10.46%, while SPY has yielded a comparatively higher 15.53% annualized return.

VAW

• 1D: -1.83%
• 1M: 0.83%
• YTD: 11.07%
• 6M: 9.68%
• 1Y: 20.68%
• 3Y*: 11.22%
• 5Y*: 6.68%
• 10Y*: 10.46%

SPY

• 1D: -1.45%
• 1M: -1.36%
• YTD: 8.15%
• 6M: 7.20%
• 1Y: 23.59%
• 3Y*: 20.68%
• 5Y*: 13.05%
• 10Y*: 15.53%

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

VAW vs. SPY - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VAW Vanguard Materials ETF	11.07%	12.30%	0.48%	13.67%	-11.80%	27.43%	19.44%	23.53%	-17.49%	23.76%
SPY State Street SPDR S&P 500 ETF	8.15%	17.72%	24.89%	26.18%	-18.18%	28.73%	18.33%	31.22%	-4.57%	21.71%

Correlation

The correlation between VAW and SPY is 0.59, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.59
Correlation (3Y) Calculated over the trailing 3-year period	0.67
Correlation (5Y) Calculated over the trailing 5-year period	0.74
Correlation (10Y) Calculated over the trailing 10-year period	0.76
Correlation (All Time) Calculated using the full available price history since Jan 30, 2004	0.79

Over the past year, the correlation between VAW and SPY has dropped to 0.59 - well below their long-term average of 0.79, suggesting their price drivers have been diverging.

VAW vs. SPY - Sectors Allocation Comparison

Sectors	VAW	SPY
Basic Materials	90.1%	1.7%
Consumer Cyclical	8.3%	9.9%
Industrials	1.1%	7.8%
Healthcare	0.5%	8.3%
Technology	0.1%	39.0%
Consumer Defensive	0.0%	4.5%
Energy	0.0%	3.1%
Communication Services	-	10.6%
Financial Services	-	11.1%
Real Estate	-	1.8%
Utilities	-	2.1%

Return for Risk

VAW vs. SPY — Risk / Return Rank

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

VAW

VAW Risk / Return Rank: 32
VAW Sharpe Ratio Rank: 32
VAW Sortino Ratio Rank: 32
VAW Omega Ratio Rank: 30
VAW Calmar Ratio Rank: 32
VAW Martin Ratio Rank: 34

SPY

SPY Risk / Return Rank: 59
SPY Sharpe Ratio Rank: 58
SPY Sortino Ratio Rank: 56
SPY Omega Ratio Rank: 57
SPY Calmar Ratio Rank: 56
SPY Martin Ratio Rank: 67

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.

VAW vs. SPY - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Materials ETF (VAW) and State Street SPDR S&P 500 ETF (SPY). 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.

	VAW	SPY	Difference
Sharpe ratio: Return per unit of total volatility	1.13	1.90	-0.77
Sortino ratio: Return per unit of downside risk	1.65	2.58	-0.93
Omega ratio: Gain probability vs. loss probability	1.20	1.34	-0.15
Calmar ratio: Return relative to maximum drawdown	1.55	2.67	-1.12
Martin ratio: Return relative to average drawdown	4.90	11.92	-7.02

VAW vs. SPY - Sharpe Ratio Comparison

The current VAW Sharpe Ratio is 1.13, which is lower than the SPY Sharpe Ratio of 1.90. The chart below compares the historical Sharpe Ratios of VAW and SPY, 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

VAW vs. SPY - Drawdown Comparison

The maximum VAW drawdown since its inception was -62.17%, which is greater than SPY's maximum drawdown of -55.19%. Use the drawdown chart below to compare losses from any high point for VAW and SPY.

Drawdown Indicators

	VAW	SPY	Difference
Max Drawdown Largest peak-to-trough decline	-62.17%	-55.19%	-6.98%
Max Drawdown (1Y) Largest decline over 1 year	-13.42%	-8.88%	-4.54%
Max Drawdown (3Y) Largest decline over 3 years	-23.21%	-18.76%	-4.45%
Max Drawdown (5Y) Largest decline over 5 years	-25.50%	-24.50%	-1.00%
Max Drawdown (10Y) Largest decline over 10 years	-41.13%	-33.72%	-7.41%
Current Drawdown Current decline from peak	-5.58%	-3.17%	-2.41%
Average Drawdown Average peak-to-trough decline	-9.62%	-9.04%	-0.58%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.23%	1.98%	+2.25%

Volatility

VAW vs. SPY - Volatility Comparison

Vanguard Materials ETF (VAW) has a higher volatility of 6.78% compared to State Street SPDR S&P 500 ETF (SPY) at 4.87%. This indicates that VAW's price experiences larger fluctuations and is considered to be riskier than SPY based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VAW	SPY	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.78%	4.87%	+1.91%
Volatility (6M) Calculated over the trailing 6-month period	14.86%	9.85%	+5.01%
Volatility (1Y) Calculated over the trailing 1-year period	18.50%	12.50%	+6.00%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	19.72%	17.15%	+2.57%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	21.23%	17.95%	+3.28%

VAW vs. SPY - Expense Ratio Comparison

VAW has a 0.09% expense ratio, which is lower than SPY's 0.09% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VAW vs. SPY - Dividend Comparison

VAW's dividend yield for the trailing twelve months is around 1.39%, more than SPY's 1.03% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
SPY State Street SPDR S&P 500 ETF	1.03%	1.07%	1.21%	1.40%	1.65%	1.20%	1.52%	1.75%	2.04%	1.80%	2.03%	2.06%
VAW Vanguard Materials ETF	1.39%	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 VAW and SPY in my portfolio?

VAW and SPY have a correlation of 0.59, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VAW or SPY?

VAW has higher volatility (6.78%) compared to SPY (4.87%). In terms of maximum drawdown, VAW dropped -62.17% vs SPY's -55.19%.

Which ETF is better, VAW or SPY?

On 10-year performance, SPY leads with 15.53% vs 10.46% for VAW. On fees, VAW is cheaper at 0.09% per year. On volatility, SPY has been the lower-risk option at 4.87%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VAW or SPY?

Over the 10-year period, SPY has performed better with a 15.53% return vs 10.46%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VAW or SPY?

VAW is cheaper with a 0.09% expense ratio, compared with 0.09% for SPY.

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

VAW has the higher dividend yield at 1.39%, compared with 1.03% for SPY.

What is the main difference between VAW and SPY?

VAW is categorized as Materials, while SPY is S&P 500. VAW tracks MSCI US Investable Market Materials 25/50 Index, while SPY tracks S&P 500 Index. They also come from different issuers: Vanguard and State Street. Their fees differ too: 0.09% for VAW and 0.09% for SPY.

Which has better risk-adjusted returns?

SPY currently has the higher Sharpe Ratio (1.90 vs 1.13), 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.