VNQ vs. IWS

Last updated Jun 13, 2026

VNQ (Vanguard Real Estate ETF) and IWS (iShares Russell Mid-Cap Value ETF) are both exchange-traded funds - VNQ is a REIT fund tracking the MSCI US Investable Market Real Estate 25/50 Index, while IWS is a Mid Cap Value Equities fund tracking the Russell Midcap Value Index. Both are passively managed. Over the past 10 years, VNQ returned 5.65%/yr vs 10.51%/yr for IWS. A 0.74 correlation means they provide meaningful diversification when combined. VNQ charges 0.13%/yr vs 0.23%/yr for IWS.

Performance

VNQ vs. IWS - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Real Estate ETF (VNQ) and iShares Russell Mid-Cap Value ETF (IWS). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VNQ achieves a 12.51% return, which is significantly lower than IWS's 16.45% return. Over the past 10 years, VNQ has underperformed IWS with an annualized return of 5.65%, while IWS has yielded a comparatively higher 10.51% annualized return.

VNQ

• 1D: 0.92%
• 1M: 2.73%
• YTD: 12.51%
• 6M: 12.32%
• 1Y: 12.92%
• 3Y*: 10.14%
• 5Y*: 2.55%
• 10Y*: 5.65%

IWS

• 1D: 1.16%
• 1M: 4.03%
• YTD: 16.45%
• 6M: 15.28%
• 1Y: 27.58%
• 3Y*: 16.65%
• 5Y*: 8.67%
• 10Y*: 10.51%

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

VNQ vs. IWS - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VNQ Vanguard Real Estate ETF	12.51%	3.24%	4.81%	11.85%	-26.25%	40.54%	-4.61%	28.91%	-6.03%	4.90%
IWS iShares Russell Mid-Cap Value ETF	16.45%	10.82%	12.91%	12.52%	-12.29%	28.10%	4.83%	26.73%	-12.43%	13.14%

Correlation

The correlation between VNQ and IWS is 0.65, 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	0.65
Correlation (3Y) Calculated over the trailing 3-year period	0.73
Correlation (5Y) Calculated over the trailing 5-year period	0.76
Correlation (10Y) Calculated over the trailing 10-year period	0.70
Correlation (All Time) Calculated using the full available price history since Sep 29, 2004	0.74

The correlation between VNQ and IWS shifts across timeframes, from 0.65 (1 year) to 0.76 (5 years), reflecting how their relationship changes across market environments.

VNQ vs. IWS - Sectors Allocation Comparison

Sectors	VNQ	IWS
Real Estate	97.3%	8.2%
Basic Materials	1.1%	5.4%
Communication Services	0.6%	3.0%
Technology	0.3%	18.2%
Energy	0.1%	7.7%
Financial Services	0.1%	13.7%
Industrials	0.0%	16.5%
Consumer Cyclical	-	8.4%
Consumer Defensive	-	4.8%
Healthcare	-	7.5%
Utilities	-	6.5%

Return for Risk

VNQ vs. IWS — Risk / Return Rank

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

VNQ

VNQ Risk / Return Rank: 32
VNQ Sharpe Ratio Rank: 30
VNQ Sortino Ratio Rank: 28
VNQ Omega Ratio Rank: 28
VNQ Calmar Ratio Rank: 35
VNQ Martin Ratio Rank: 36

IWS

IWS Risk / Return Rank: 76
IWS Sharpe Ratio Rank: 73
IWS Sortino Ratio Rank: 75
IWS Omega Ratio Rank: 69
IWS Calmar Ratio Rank: 80
IWS Martin Ratio Rank: 81

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.

VNQ vs. IWS - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Real Estate ETF (VNQ) and iShares Russell Mid-Cap Value ETF (IWS). 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.

	VNQ	IWS	Difference
Sharpe ratio: Return per unit of total volatility	0.96	2.05	-1.09
Sortino ratio: Return per unit of downside risk	1.39	2.91	-1.52
Omega ratio: Gain probability vs. loss probability	1.17	1.36	-0.18
Calmar ratio: Return relative to maximum drawdown	1.56	3.68	-2.12
Martin ratio: Return relative to average drawdown	4.90	13.82	-8.92

VNQ vs. IWS - Sharpe Ratio Comparison

The current VNQ Sharpe Ratio is 0.96, which is lower than the IWS Sharpe Ratio of 2.05. The chart below compares the historical Sharpe Ratios of VNQ and IWS, 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

VNQ vs. IWS - Drawdown Comparison

The maximum VNQ drawdown since its inception was -73.07%, which is greater than IWS's maximum drawdown of -62.40%. Use the drawdown chart below to compare losses from any high point for VNQ and IWS.

Drawdown Indicators

	VNQ	IWS	Difference
Max Drawdown Largest peak-to-trough decline	-73.07%	-62.40%	-10.67%
Max Drawdown (1Y) Largest decline over 1 year	-8.34%	-7.53%	-0.81%
Max Drawdown (3Y) Largest decline over 3 years	-17.46%	-20.57%	+3.11%
Max Drawdown (5Y) Largest decline over 5 years	-34.48%	-21.23%	-13.25%
Max Drawdown (10Y) Largest decline over 10 years	-42.40%	-43.83%	+1.43%
Current Drawdown Current decline from peak	0.00%	0.00%	0.00%
Average Drawdown Average peak-to-trough decline	-13.61%	-8.01%	-5.60%
Ulcer Index Depth and duration of drawdowns from previous peaks	2.65%	2.00%	+0.65%

Volatility

VNQ vs. IWS - Volatility Comparison

Vanguard Real Estate ETF (VNQ) has a higher volatility of 4.72% compared to iShares Russell Mid-Cap Value ETF (IWS) at 4.29%. This indicates that VNQ's price experiences larger fluctuations and is considered to be riskier than IWS based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VNQ	IWS	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.72%	4.29%	+0.43%
Volatility (6M) Calculated over the trailing 6-month period	9.77%	9.97%	-0.20%
Volatility (1Y) Calculated over the trailing 1-year period	13.54%	13.53%	+0.01%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	18.84%	17.36%	+1.48%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	20.72%	19.37%	+1.35%

VNQ vs. IWS - Expense Ratio Comparison

VNQ has a 0.13% expense ratio, which is lower than IWS's 0.23% 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

VNQ vs. IWS - Dividend Comparison

VNQ's dividend yield for the trailing twelve months is around 3.54%, more than IWS's 1.32% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
IWS iShares Russell Mid-Cap Value ETF	1.32%	1.53%	1.50%	1.76%	1.93%	1.39%	1.87%	1.97%	2.53%	1.96%	2.10%	2.14%
VNQ Vanguard Real Estate ETF	3.54%	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

Can I hold both VNQ and IWS in my portfolio?

VNQ and IWS have a correlation of 0.65, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VNQ or IWS?

VNQ has higher volatility (4.72%) compared to IWS (4.29%). In terms of maximum drawdown, VNQ dropped -73.07% vs IWS's -62.40%.

Which ETF is better, VNQ or IWS?

On 10-year performance, IWS leads with 10.51% vs 5.65% for VNQ. On fees, VNQ is cheaper at 0.13% per year. On volatility, IWS has been the lower-risk option at 4.29%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VNQ or IWS?

Over the 10-year period, IWS has performed better with a 10.51% return vs 5.65%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VNQ or IWS?

VNQ is cheaper with a 0.13% expense ratio, compared with 0.23% for IWS.

Which ETF pays a higher dividend yield, VNQ or IWS?

VNQ has the higher dividend yield at 3.54%, compared with 1.32% for IWS.

What is the main difference between VNQ and IWS?

VNQ is categorized as REIT, while IWS is Mid Cap Value Equities. VNQ tracks MSCI US Investable Market Real Estate 25/50 Index, while IWS tracks Russell Midcap Value Index. They also come from different issuers: Vanguard and iShares. Their fees differ too: 0.13% for VNQ and 0.23% for IWS.

Which has better risk-adjusted returns?

IWS currently has the higher Sharpe Ratio (2.05 vs 0.96), 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.