VGT vs. VFH

Last updated Jun 16, 2026

VGT (Vanguard Information Technology ETF) and VFH (Vanguard Financials ETF) are both exchange-traded funds - VGT is a Technology Equities fund tracking the MSCI USA IMI Information Technology 25/50 Index, while VFH is a Financials Equities fund tracking the MSCI US Investable Market Financials 25/50 Index. Both are passively managed. Over the past 10 years, VGT returned 25.72%/yr vs 13.15%/yr for VFH. A 0.63 correlation means they provide meaningful diversification when combined. Both charge a 0.09% expense ratio.

Performance

VGT vs. VFH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Information Technology ETF (VGT) and Vanguard Financials ETF (VFH). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VGT achieves a 28.27% return, which is significantly higher than VFH's -1.27% return. Over the past 10 years, VGT has outperformed VFH with an annualized return of 25.72%, while VFH has yielded a comparatively lower 13.15% annualized return.

VGT

• 1D: 3.42%
• 1M: 6.55%
• YTD: 28.27%
• 6M: 29.82%
• 1Y: 55.62%
• 3Y*: 30.76%
• 5Y*: 21.17%
• 10Y*: 25.72%

VFH

• 1D: 0.31%
• 1M: 4.86%
• YTD: -1.27%
• 6M: -1.47%
• 1Y: 10.26%
• 3Y*: 19.61%
• 5Y*: 9.57%
• 10Y*: 13.15%

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

VGT vs. VFH - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VGT Vanguard Information Technology ETF	28.27%	21.77%	29.30%	52.66%	-29.70%	30.45%	46.04%	48.62%	2.46%	37.08%
VFH Vanguard Financials ETF	-1.27%	14.91%	30.44%	14.17%	-12.31%	35.22%	-1.96%	31.57%	-13.52%	19.99%

Correlation

The correlation between VGT and VFH is 0.36, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.36
Correlation (3Y) Calculated over the trailing 3-year period	0.43
Correlation (5Y) Calculated over the trailing 5-year period	0.55
Correlation (10Y) Calculated over the trailing 10-year period	0.53
Correlation (All Time) Calculated using the full available price history since Jan 30, 2004	0.63

Over the past year, the correlation between VGT and VFH has dropped to 0.36 - well below their long-term average of 0.63, suggesting their price drivers have been diverging.

VGT vs. VFH - Sectors Allocation Comparison

Sectors	VGT	VFH
Technology	98.5%	2.1%
Communication Services	0.5%	0.0%
Financial Services	0.5%	96.8%
Industrials	0.4%	0.2%
Energy	0.3%	-
Consumer Cyclical	0.1%	0.0%
Basic Materials	0.0%	-
Healthcare	0.0%	0.1%
Consumer Defensive	-	-
Real Estate	-	0.8%
Utilities	-	-

Return for Risk

VGT vs. VFH — Risk / Return Rank

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

VGT

VGT Risk / Return Rank: 77
VGT Sharpe Ratio Rank: 87
VGT Sortino Ratio Rank: 78
VGT Omega Ratio Rank: 79
VGT Calmar Ratio Rank: 74
VGT Martin Ratio Rank: 65

VFH

VFH Risk / Return Rank: 20
VFH Sharpe Ratio Rank: 22
VFH Sortino Ratio Rank: 21
VFH Omega Ratio Rank: 21
VFH Calmar Ratio Rank: 18
VFH Martin Ratio Rank: 19

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.

VGT vs. VFH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Information Technology ETF (VGT) and Vanguard Financials ETF (VFH). 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.

	VGT	VFH	Difference
Sharpe ratio: Return per unit of total volatility	2.52	0.69	+1.83
Sortino ratio: Return per unit of downside risk	3.09	1.02	+2.07
Omega ratio: Gain probability vs. loss probability	1.41	1.13	+0.29
Calmar ratio: Return relative to maximum drawdown	3.41	0.70	+2.71
Martin ratio: Return relative to average drawdown	10.55	1.82	+8.73

VGT vs. VFH - Sharpe Ratio Comparison

The current VGT Sharpe Ratio is 2.52, which is higher than the VFH Sharpe Ratio of 0.69. The chart below compares the historical Sharpe Ratios of VGT and VFH, 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

VGT vs. VFH - Drawdown Comparison

The maximum VGT drawdown since its inception was -54.63%, smaller than the maximum VFH drawdown of -78.61%. Use the drawdown chart below to compare losses from any high point for VGT and VFH.

Drawdown Indicators

	VGT	VFH	Difference
Max Drawdown Largest peak-to-trough decline	-54.63%	-78.61%	+23.98%
Max Drawdown (1Y) Largest decline over 1 year	-16.40%	-14.75%	-1.65%
Max Drawdown (3Y) Largest decline over 3 years	-27.23%	-17.30%	-9.93%
Max Drawdown (5Y) Largest decline over 5 years	-35.07%	-25.66%	-9.41%
Max Drawdown (10Y) Largest decline over 10 years	-35.07%	-44.42%	+9.35%
Current Drawdown Current decline from peak	-4.01%	-4.27%	+0.26%
Average Drawdown Average peak-to-trough decline	-7.95%	-18.52%	+10.57%
Ulcer Index Depth and duration of drawdowns from previous peaks	5.29%	5.65%	-0.36%

Volatility

VGT vs. VFH - Volatility Comparison

Vanguard Information Technology ETF (VGT) has a higher volatility of 10.42% compared to Vanguard Financials ETF (VFH) at 4.31%. This indicates that VGT's price experiences larger fluctuations and is considered to be riskier than VFH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VGT	VFH	Difference
Volatility (1M) Calculated over the trailing 1-month period	10.42%	4.31%	+6.11%
Volatility (6M) Calculated over the trailing 6-month period	18.28%	11.28%	+7.00%
Volatility (1Y) Calculated over the trailing 1-year period	22.20%	14.94%	+7.26%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	25.45%	19.34%	+6.11%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	24.75%	22.56%	+2.19%

VGT vs. VFH - Expense Ratio Comparison

Both VGT and VFH have an expense ratio of 0.09%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.

Dividends

VGT vs. VFH - Dividend Comparison

VGT's dividend yield for the trailing twelve months is around 0.32%, less than VFH's 1.48% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VFH Vanguard Financials ETF	1.48%	1.55%	1.75%	2.08%	2.31%	1.87%	2.21%	2.17%	2.30%	1.53%	1.63%	2.00%
VGT Vanguard Information Technology ETF	0.32%	0.40%	0.60%	0.65%	0.91%	0.64%	0.82%	1.11%	1.29%	0.99%	1.31%	1.28%

Frequently Asked Questions

Can I hold both VGT and VFH in my portfolio?

VGT and VFH have a correlation of 0.36, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VGT or VFH?

VGT has higher volatility (10.42%) compared to VFH (4.31%). In terms of maximum drawdown, VGT dropped -54.63% vs VFH's -78.61%.

Which ETF is better, VGT or VFH?

On 10-year performance, VGT leads with 25.72% vs 13.15% for VFH. Both ETFs have the same 0.09% expense ratio. On volatility, VFH has been the lower-risk option at 4.31%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VGT or VFH?

Over the 10-year period, VGT has performed better with a 25.72% return vs 13.15%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VGT or VFH?

VGT and VFH have the same expense ratio: 0.09% per year.

Which ETF pays a higher dividend yield, VGT or VFH?

VFH has the higher dividend yield at 1.48%, compared with 0.32% for VGT.

What is the main difference between VGT and VFH?

VGT is categorized as Technology Equities, while VFH is Financials Equities. VGT tracks MSCI USA IMI Information Technology 25/50 Index, while VFH tracks MSCI US Investable Market Financials 25/50 Index.

Which has better risk-adjusted returns?

VGT currently has the higher Sharpe Ratio (2.52 vs 0.69), 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.