VFORX vs. VWELX

Last updated Jun 4, 2026

VFORX (Vanguard Target Retirement 2040 Fund) and VWELX (Vanguard Wellington Fund Investor Shares) are both mutual funds - VFORX is a Target Retirement Date fund managed by Vanguard, while VWELX is a Diversified Portfolio fund actively managed by Vanguard. Over the past 10 years, VFORX returned 10.66%/yr vs 10.20%/yr for VWELX. With a 0.95 correlation, they move nearly in lockstep. VFORX charges 0.08%/yr vs 0.24%/yr for VWELX.

Performance

VFORX vs. VWELX - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Target Retirement 2040 Fund (VFORX) and Vanguard Wellington Fund Investor Shares (VWELX). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VFORX achieves a 10.11% return, which is significantly higher than VWELX's 7.11% return. Both investments have delivered pretty close results over the past 10 years, with VFORX having a 10.66% annualized return and VWELX not far behind at 10.20%.

VFORX

• 1D: 0.31%
• 1M: 4.40%
• YTD: 10.11%
• 6M: 10.85%
• 1Y: 23.95%
• 3Y*: 17.28%
• 5Y*: 8.86%
• 10Y*: 10.66%

VWELX

• 1D: 0.06%
• 1M: 3.86%
• YTD: 7.11%
• 6M: 7.36%
• 1Y: 21.02%
• 3Y*: 15.61%
• 5Y*: 8.97%
• 10Y*: 10.20%

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

VFORX vs. VWELX - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VFORX Vanguard Target Retirement 2040 Fund	10.11%	18.77%	12.90%	18.56%	-17.00%	14.55%	15.48%	23.86%	-7.32%	18.45%
VWELX Vanguard Wellington Fund Investor Shares	7.11%	16.54%	14.73%	14.29%	-14.36%	18.99%	10.57%	22.51%	-3.43%	13.98%

Correlation

The correlation between VFORX and VWELX 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	0.94
Correlation (5Y) Calculated over the trailing 5-year period	0.94
Correlation (10Y) Calculated over the trailing 10-year period	0.94
Correlation (All Time) Calculated using the full available price history since Jun 8, 2006	0.95

The correlation between VFORX and VWELX has been stable across timeframes, ranging from 0.94 to 0.95 - a consistent structural relationship.

VFORX vs. VWELX - Sectors Allocation Comparison

Sectors	VFORX	VWELX
Technology	27.4%	31.8%
Financial Services	16.1%	10.6%
Industrials	12.3%	8.5%
Consumer Cyclical	9.4%	10.9%
Healthcare	8.3%	9.8%
Communication Services	8.0%	12.3%
Consumer Defensive	4.8%	4.4%
Energy	4.3%	4.4%
Basic Materials	4.3%	2.1%
Utilities	2.7%	2.5%
Real Estate	2.5%	2.6%

Return for Risk

VFORX vs. VWELX — Risk / Return Rank

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

VFORX

VFORX Risk / Return Rank: 71
VFORX Sharpe Ratio Rank: 74
VFORX Sortino Ratio Rank: 71
VFORX Omega Ratio Rank: 69
VFORX Calmar Ratio Rank: 67
VFORX Martin Ratio Rank: 73

VWELX

VWELX Risk / Return Rank: 74
VWELX Sharpe Ratio Rank: 78
VWELX Sortino Ratio Rank: 75
VWELX Omega Ratio Rank: 73
VWELX Calmar Ratio Rank: 68
VWELX 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.

VFORX vs. VWELX - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Target Retirement 2040 Fund (VFORX) and Vanguard Wellington Fund Investor Shares (VWELX). 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.

	VFORX	VWELX	Difference
Sharpe ratio: Return per unit of total volatility	2.50	2.56	-0.06
Sortino ratio: Return per unit of downside risk	3.50	3.60	-0.10
Omega ratio: Gain probability vs. loss probability	1.46	1.48	-0.02
Calmar ratio: Return relative to maximum drawdown	3.15	3.17	-0.02
Martin ratio: Return relative to average drawdown	13.90	14.69	-0.79
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VFORX vs. VWELX - Sharpe Ratio Comparison

The current VFORX Sharpe Ratio is 2.50, which is comparable to the VWELX Sharpe Ratio of 2.56. The chart below compares the historical Sharpe Ratios of VFORX and VWELX, 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

	VFORX	VWELX	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.50	2.56	-0.06
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.72	0.81	-0.09
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.78	0.89	-0.11
Sharpe Ratio (All Time) Calculated using the full available price history	0.50	0.84	-0.34

Drawdowns

VFORX vs. VWELX - Drawdown Comparison

The maximum VFORX drawdown since its inception was -51.63%, which is greater than VWELX's maximum drawdown of -36.12%. Use the drawdown chart below to compare losses from any high point for VFORX and VWELX.

Drawdown Indicators

	VFORX	VWELX	Difference
Max Drawdown Largest peak-to-trough decline	-51.63%	-36.12%	-15.51%
Max Drawdown (1Y) Largest decline over 1 year	-7.70%	-6.78%	-0.92%
Max Drawdown (3Y) Largest decline over 3 years	-12.12%	-11.98%	-0.14%
Max Drawdown (5Y) Largest decline over 5 years	-24.32%	-20.88%	-3.44%
Max Drawdown (10Y) Largest decline over 10 years	-29.35%	-25.33%	-4.02%
Current Drawdown Current decline from peak	0.00%	0.00%	0.00%
Average Drawdown Average peak-to-trough decline	-6.77%	-3.92%	-2.85%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.74%	1.46%	+0.28%

Volatility

VFORX vs. VWELX - Volatility Comparison

Vanguard Target Retirement 2040 Fund (VFORX) has a higher volatility of 2.99% compared to Vanguard Wellington Fund Investor Shares (VWELX) at 2.52%. This indicates that VFORX's price experiences larger fluctuations and is considered to be riskier than VWELX based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VFORX	VWELX	Difference
Volatility (1M) Calculated over the trailing 1-month period	2.99%	2.52%	+0.47%
Volatility (6M) Calculated over the trailing 6-month period	7.78%	6.67%	+1.11%
Volatility (1Y) Calculated over the trailing 1-year period	9.71%	8.38%	+1.33%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	12.43%	11.13%	+1.30%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	13.68%	11.53%	+2.15%

VFORX vs. VWELX - Expense Ratio Comparison

VFORX has a 0.08% expense ratio, which is lower than VWELX's 0.24% 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

VFORX vs. VWELX - Dividend Comparison

VFORX's dividend yield for the trailing twelve months is around 2.51%, less than VWELX's 10.76% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VFORX Vanguard Target Retirement 2040 Fund	2.51%	2.77%	2.86%	2.38%	2.60%	20.68%	2.06%	2.28%	2.58%	0.04%	2.40%	2.99%
VWELX Vanguard Wellington Fund Investor Shares	10.76%	11.46%	10.76%	6.01%	8.19%	8.64%	7.77%	4.67%	9.49%	5.82%	4.44%	7.03%

Frequently Asked Questions

Can I hold both VFORX and VWELX in my portfolio?

With a correlation of 0.94, VFORX and VWELX 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, VFORX or VWELX?

VFORX has higher volatility (2.99%) compared to VWELX (2.52%). In terms of maximum drawdown, VFORX dropped -51.63% vs VWELX's -36.12%.

Which has better risk-adjusted returns?

VWELX currently has the higher Sharpe Ratio (2.56 vs 2.50), 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.