VDEQX vs. SPY

Last updated Jun 5, 2026

VDEQX (Vanguard Diversified Equity Fund) and SPY (State Street SPDR S&P 500 ETF) are both funds - VDEQX is a Large Cap Growth Equities fund managed by Vanguard, while SPY is a S&P 500 fund tracking the S&P 500 Index. Over the past 10 years, VDEQX returned 14.37%/yr vs 15.48%/yr for SPY. With a 0.97 correlation, they move nearly in lockstep. VDEQX charges 0.35%/yr vs 0.09%/yr for SPY.

Performance

VDEQX vs. SPY - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Diversified Equity Fund (VDEQX) 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, VDEQX achieves a 6.74% return, which is significantly lower than SPY's 11.33% return. Over the past 10 years, VDEQX has underperformed SPY with an annualized return of 14.37%, while SPY has yielded a comparatively higher 15.48% annualized return.

VDEQX

• 1D: -1.00%
• 1M: 3.13%
• YTD: 6.74%
• 6M: 6.76%
• 1Y: 21.03%
• 3Y*: 20.10%
• 5Y*: 10.42%
• 10Y*: 14.37%

SPY

• 1D: 0.38%
• 1M: 4.60%
• YTD: 11.33%
• 6M: 11.25%
• 1Y: 28.50%
• 3Y*: 22.58%
• 5Y*: 13.91%
• 10Y*: 15.48%

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

VDEQX vs. SPY - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VDEQX Vanguard Diversified Equity Fund	6.74%	15.26%	24.63%	27.51%	-22.59%	21.69%	29.01%	31.44%	-5.40%	21.47%
SPY State Street SPDR S&P 500 ETF	11.33%	17.72%	24.89%	26.18%	-18.18%	28.73%	18.33%	31.22%	-4.57%	21.71%

Correlation

The correlation between VDEQX and SPY is 0.96 - 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	0.96
Correlation (3Y) Calculated over the trailing 3-year period	0.96
Correlation (5Y) Calculated over the trailing 5-year period	0.97
Correlation (10Y) Calculated over the trailing 10-year period	0.97
Correlation (All Time) Calculated using the full available price history since Jun 13, 2005	0.97

The correlation between VDEQX and SPY has been stable across timeframes, ranging from 0.96 to 0.97 - a consistent structural relationship.

VDEQX vs. SPY - Sectors Allocation Comparison

Sectors	VDEQX	SPY
Technology	28.9%	35.9%
Financial Services	13.7%	11.8%
Healthcare	13.4%	8.4%
Consumer Cyclical	11.5%	10.3%
Communication Services	10.0%	11.3%
Industrials	9.6%	7.8%
Energy	3.4%	3.6%
Consumer Defensive	3.4%	4.8%
Basic Materials	2.6%	1.8%
Real Estate	1.8%	1.9%
Utilities	1.7%	2.4%

Return for Risk

VDEQX vs. SPY — Risk / Return Rank

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

VDEQX

VDEQX Risk / Return Rank: 32
VDEQX Sharpe Ratio Rank: 33
VDEQX Sortino Ratio Rank: 30
VDEQX Omega Ratio Rank: 32
VDEQX Calmar Ratio Rank: 28
VDEQX Martin Ratio Rank: 37

SPY

SPY Risk / Return Rank: 74
SPY Sharpe Ratio Rank: 76
SPY Sortino Ratio Rank: 74
SPY Omega Ratio Rank: 75
SPY Calmar Ratio Rank: 66
SPY Martin Ratio Rank: 78

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.

VDEQX vs. SPY - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Diversified Equity Fund (VDEQX) 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.

	VDEQX	SPY	Difference
Sharpe ratio: Return per unit of total volatility	1.65	2.42	-0.77
Sortino ratio: Return per unit of downside risk	2.29	3.29	-1.00
Omega ratio: Gain probability vs. loss probability	1.30	1.44	-0.14
Calmar ratio: Return relative to maximum drawdown	1.97	3.22	-1.25
Martin ratio: Return relative to average drawdown	8.05	14.99	-6.94
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VDEQX vs. SPY - Sharpe Ratio Comparison

The current VDEQX Sharpe Ratio is 1.65, which is lower than the SPY Sharpe Ratio of 2.42. The chart below compares the historical Sharpe Ratios of VDEQX 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.

Sharpe Ratios by Period

	VDEQX	SPY	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.65	2.42	-0.77
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.56	0.82	-0.26
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.75	0.87	-0.12
Sharpe Ratio (All Time) Calculated using the full available price history	0.52	0.59	-0.06

Drawdowns

VDEQX vs. SPY - Drawdown Comparison

The maximum VDEQX drawdown since its inception was -56.28%, roughly equal to the maximum SPY drawdown of -55.19%. Use the drawdown chart below to compare losses from any high point for VDEQX and SPY.

Drawdown Indicators

	VDEQX	SPY	Difference
Max Drawdown Largest peak-to-trough decline	-56.28%	-55.19%	-1.09%
Max Drawdown (1Y) Largest decline over 1 year	-10.86%	-8.88%	-1.98%
Max Drawdown (3Y) Largest decline over 3 years	-20.50%	-18.76%	-1.74%
Max Drawdown (5Y) Largest decline over 5 years	-29.26%	-24.50%	-4.76%
Max Drawdown (10Y) Largest decline over 10 years	-35.47%	-33.72%	-1.75%
Current Drawdown Current decline from peak	-1.17%	-0.33%	-0.84%
Average Drawdown Average peak-to-trough decline	-8.28%	-9.05%	+0.77%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.65%	1.91%	+0.74%

Volatility

VDEQX vs. SPY - Volatility Comparison

Vanguard Diversified Equity Fund (VDEQX) has a higher volatility of 3.06% compared to State Street SPDR S&P 500 ETF (SPY) at 2.79%. This indicates that VDEQX'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

	VDEQX	SPY	Difference
Volatility (1M) Calculated over the trailing 1-month period	3.06%	2.79%	+0.27%
Volatility (6M) Calculated over the trailing 6-month period	9.75%	8.91%	+0.84%
Volatility (1Y) Calculated over the trailing 1-year period	12.99%	11.82%	+1.17%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	18.59%	17.05%	+1.54%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	19.29%	17.93%	+1.36%

VDEQX vs. SPY - Expense Ratio Comparison

VDEQX has a 0.35% expense ratio, which is higher than SPY's 0.09% expense ratio.

Dividends

VDEQX vs. SPY - Dividend Comparison

VDEQX's dividend yield for the trailing twelve months is around 8.59%, more than SPY's 0.98% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
SPY State Street SPDR S&P 500 ETF	0.98%	1.07%	1.21%	1.40%	1.65%	1.20%	1.52%	1.75%	2.04%	1.80%	2.03%	2.06%
VDEQX Vanguard Diversified Equity Fund	8.59%	9.17%	7.53%	4.65%	12.92%	7.13%	5.82%	7.20%	6.61%	4.63%	7.67%	9.42%

Frequently Asked Questions

Can I hold both VDEQX and SPY in my portfolio?

With a correlation of 0.96, VDEQX and SPY 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, VDEQX or SPY?

VDEQX has higher volatility (3.06%) compared to SPY (2.79%). In terms of maximum drawdown, VDEQX dropped -56.28% vs SPY's -55.19%.

Which has better risk-adjusted returns?

SPY currently has the higher Sharpe Ratio (2.42 vs 1.65), 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.