VAW vs. VNQ
VAW (Vanguard Materials ETF) and VNQ (Vanguard Real Estate ETF) are both exchange-traded funds - VAW is a Materials fund tracking the MSCI US Investable Market Materials 25/50 Index, while VNQ is a REIT fund tracking the MSCI US Investable Market Real Estate 25/50 Index. Both are passively managed. Over the past 10 years, VAW returned 10.46%/yr vs 5.44%/yr for VNQ. A 0.58 correlation means they provide meaningful diversification when combined. VAW charges 0.09%/yr vs 0.13%/yr for VNQ.
Performance
VAW vs. VNQ - Performance Comparison
Loading charts...
Returns By Period
In the year-to-date period, VAW achieves a 11.07% return, which is significantly lower than VNQ's 11.77% return. Over the past 10 years, VAW has outperformed VNQ with an annualized return of 10.46%, while VNQ has yielded a comparatively lower 5.44% 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%
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%
VAW vs. VNQ - 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% |
VNQ Vanguard Real Estate ETF | 11.77% | 3.24% | 4.81% | 11.85% | -26.25% | 40.54% | -4.61% | 28.91% | -6.03% | 4.90% |
Correlation
The correlation between VAW and VNQ is 0.50, 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 | 0.50 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.60 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.64 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.55 |
Correlation (All Time) Calculated using the full available price history since Sep 29, 2004 | 0.58 |
The correlation between VAW and VNQ shifts across timeframes, from 0.50 (1 year) to 0.64 (5 years), reflecting how their relationship changes across market environments.
Compare stocks, funds, or ETFs
Search for stocks, ETFs, and funds for a quick comparison or use the comparison tool for more options.
Return for Risk
VAW vs. VNQ — Risk / Return Rank
VAW
VNQ
VAW vs. VNQ - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Vanguard Materials ETF (VAW) 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.
| VAW | VNQ | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.28 | ||
| Sortino ratioReturn per unit of downside risk | +0.42 | ||
| Omega ratioGain probability vs. loss probability | 1.20 | 1.15 | +0.04 |
| Calmar ratioReturn relative to maximum drawdown | 1.55 | 1.40 | +0.15 |
| Martin ratioReturn relative to average drawdown | 4.90 | 4.37 | +0.53 |
Loading charts...
Drawdowns
VAW vs. VNQ - Drawdown Comparison
The maximum VAW drawdown since its inception was -62.17%, smaller than the maximum VNQ drawdown of -73.07%. Use the drawdown chart below to compare losses from any high point for VAW and VNQ.
Loading charts...
Drawdown Indicators
| VAW | VNQ | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -62.17% | -73.07% | +10.90% |
Max Drawdown (1Y)Largest decline over 1 year | -13.42% | -8.34% | -5.08% |
Max Drawdown (3Y)Largest decline over 3 years | -23.21% | -17.46% | -5.75% |
Max Drawdown (5Y)Largest decline over 5 years | -25.50% | -34.48% | +8.98% |
Max Drawdown (10Y)Largest decline over 10 years | -41.13% | -42.40% | +1.27% |
Current DrawdownCurrent decline from peak | -5.58% | -0.66% | -4.92% |
Average DrawdownAverage peak-to-trough decline | -9.62% | -13.60% | +3.98% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 4.23% | 2.66% | +1.57% |
Volatility
VAW vs. VNQ - Volatility Comparison
Vanguard Materials ETF (VAW) has a higher volatility of 6.78% compared to Vanguard Real Estate ETF (VNQ) at 5.19%. This indicates that VAW's price experiences larger fluctuations and is considered to be riskier than VNQ based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
Loading charts...
Volatility by Period
| VAW | VNQ | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 6.78% | 5.19% | +1.59% |
Volatility (6M)Calculated over the trailing 6-month period | 14.86% | 10.20% | +4.66% |
Volatility (1Y)Calculated over the trailing 1-year period | 18.50% | 13.84% | +4.66% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 19.72% | 18.86% | +0.86% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 21.23% | 20.75% | +0.48% |
VAW vs. VNQ - Expense Ratio Comparison
VAW has a 0.09% expense ratio, which is lower than VNQ's 0.13% 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. VNQ - Dividend Comparison
VAW's dividend yield for the trailing twelve months is around 1.39%, less than VNQ's 3.56% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
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% |
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
VAW and VNQ have a correlation of 0.50, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
VAW has higher volatility (6.78%) compared to VNQ (5.19%). In terms of maximum drawdown, VAW dropped -62.17% vs VNQ's -73.07%.
On 10-year performance, VAW leads with 10.46% vs 5.44% for VNQ. On fees, VAW is cheaper at 0.09% per year. On volatility, VNQ has been the lower-risk option at 5.19%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, VAW has performed better with a 10.46% return vs 5.44%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
VAW is cheaper with a 0.09% expense ratio, compared with 0.13% for VNQ.
VNQ has the higher dividend yield at 3.56%, compared with 1.39% for VAW.
VAW is categorized as Materials, while VNQ is REIT. VAW tracks MSCI US Investable Market Materials 25/50 Index, while VNQ tracks MSCI US Investable Market Real Estate 25/50 Index. Their fees differ too: 0.09% for VAW and 0.13% for VNQ.
VAW currently has the higher Sharpe Ratio (1.13 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.
Find the right allocation for VAW and VNQ
Add both to a portfolio and optimize allocations for your target — whether that's maximizing returns, minimizing drawdowns, or balancing risk across holdings.
Open Portfolio Optimizer