VSS vs. VEU

Last updated Aug 2, 2026

VSS (Vanguard FTSE All-World ex-US Small-Cap ETF) and VEU (Vanguard FTSE All-World ex-US ETF) are both exchange-traded funds - VSS is a Foreign Small & Mid Cap Equities fund tracking the FTSE Global Small Cap ex US Index, while VEU is a Foreign Large Cap Equities fund tracking the FTSE All-World ex US Index. Both are passively managed. Over the past 10 years, VSS returned 7.53%/yr vs 9.66%/yr for VEU. Their correlation of 0.95 means they have usually moved in the same direction. VSS charges 0.07%/yr vs 0.04%/yr for VEU.

Performance

VSS vs. VEU - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard FTSE All-World ex-US Small-Cap ETF (VSS) and Vanguard FTSE All-World ex-US ETF (VEU). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VSS achieves a 5.59% return, which is significantly lower than VEU's 13.33% return. Over the past 10 years, VSS has underperformed VEU with an annualized return of 7.53%, while VEU has yielded a comparatively higher 9.66% annualized return.

VSS

• 1D: -0.16%
• 1M: -2.96%
• 6M: -0.76%
• YTD: 5.59%
• 1Y: 16.61%
• 3Y*: 13.20%
• 5Y*: 4.94%
• 10Y*: 7.53%
• ALL TIME*: 9.62%

VEU

• 1D: -0.22%
• 1M: -0.16%
• 6M: 7.25%
• YTD: 13.33%
• 1Y: 28.40%
• 3Y*: 17.58%
• 5Y*: 9.15%
• 10Y*: 9.66%
• ALL TIME*: 5.45%

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

Liquidity Comparison

Position	Avg. Volume Value (2W)	Avg. Volume Value (1M)	Avg. Volume Value (3M)
VEU Vanguard FTSE All-World ex-US ETF	$230.24M	$229.52M	$221.55M
VSS Vanguard FTSE All-World ex-US Small-Cap ETF	$26.20M	$30.06M	$40.76M

VSS vs. VEU - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VSS Vanguard FTSE All-World ex-US Small-Cap ETF	5.59%	29.61%	2.94%	15.52%	-21.48%	13.05%	11.81%	21.36%	-18.48%	30.61%
VEU Vanguard FTSE All-World ex-US ETF	13.33%	32.35%	5.56%	15.84%	-15.58%	8.27%	11.10%	21.83%	-14.18%	27.40%

Correlation

The correlation between VSS and VEU is 0.93, meaning they have usually moved in the same direction, including during past declines.

	Correlation
Correlation (1Y) Focuses on recent behavior, but can change the most.	0.93
Correlation (3Y) Balances recent behavior with more history.	0.93
Correlation (5Y) Shows whether the relationship held over a longer period.	0.95
Correlation (10Y) Provides a long-term view across more market conditions.	0.95
Correlation (All Time) Calculated using the full available price history since Apr 6, 2009	0.95

The correlation between VSS and VEU has been stable across timeframes, ranging from 0.93 to 0.95 - a consistent structural relationship.

VSS vs. VEU - Sectors Allocation Comparison

Sectors	VSS	VEU
Industrials	20.5%	14.7%
Technology	15.7%	23.2%
Basic Materials	12.9%	6.5%
Financial Services	12.3%	23.1%
Consumer Cyclical	9.0%	7.6%
Real Estate	7.9%	1.8%
Healthcare	6.1%	6.8%
Energy	4.6%	4.3%
Consumer Defensive	3.5%	4.9%
Utilities	2.5%	3.0%
Communication Services	2.1%	4.2%

Return for Risk

VSS vs. VEU — Risk / Return Rank

Compare historical risk-adjusted metric ranks over the past 12 months.

VSS

VSS Risk / Return Rank: 41
VSS Sharpe Ratio Rank: 41
VSS Sortino Ratio Rank: 40
VSS Omega Ratio Rank: 41
VSS Calmar Ratio Rank: 41
VSS Martin Ratio Rank: 42

VEU

VEU Risk / Return Rank: 73
VEU Sharpe Ratio Rank: 74
VEU Sortino Ratio Rank: 72
VEU Omega Ratio Rank: 74
VEU Calmar Ratio Rank: 72
VEU Martin Ratio Rank: 73

The rank (0–100) uses a weighted average of the Sharpe, Sortino, Omega, Calmar, and Martin percentile ranks for the trailing 12 months. Higher means stronger historical risk-adjusted performance within the peer group.

VSS vs. VEU - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard FTSE All-World ex-US Small-Cap ETF (VSS) and Vanguard FTSE All-World ex-US ETF (VEU). 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.

	VSS	VEU	Difference
Sharpe ratio: Return per unit of total volatility	1.02	1.66	-0.64
Sortino ratio: Return per unit of downside risk	1.47	2.31	-0.84
Omega ratio: Gain probability vs. loss probability	1.19	1.30	-0.11
Calmar ratio: Return relative to maximum drawdown	1.43	2.46	-1.03
Martin ratio: Return relative to average drawdown	4.54	9.00	-4.46

VSS vs. VEU - Sharpe Ratio Comparison

The current VSS Sharpe Ratio is 1.02, which is lower than the VEU Sharpe Ratio of 1.66. The chart below compares the historical Sharpe Ratios of VSS and VEU, 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

VSS vs. VEU - Drawdown Comparison

The maximum VSS drawdown since its inception was -43.51%, smaller than the maximum VEU drawdown of -61.52%. Use the drawdown chart below to compare losses from any high point for VSS and VEU.

Drawdown Indicators

	VSS	VEU	Difference
Max Drawdown Largest peak-to-trough decline	-43.51%	-61.52%	+18.01%
Max Drawdown (1Y) Largest decline over 1 year	-11.62%	-11.43%	-0.19%
Max Drawdown (3Y) Largest decline over 3 years	-15.73%	-13.69%	-2.04%
Max Drawdown (5Y) Largest decline over 5 years	-33.93%	-29.14%	-4.79%
Max Drawdown (10Y) Largest decline over 10 years	-43.51%	-34.98%	-8.53%
Current Drawdown Current decline from peak	-6.97%	-2.79%	-4.18%
Average Drawdown Average peak-to-trough decline	-9.60%	-13.05%	+3.45%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.65%	3.12%	+0.53%

Volatility

VSS vs. VEU - Volatility Comparison

Vanguard FTSE All-World ex-US Small-Cap ETF (VSS) and Vanguard FTSE All-World ex-US ETF (VEU) have volatilities of 5.10% and 5.31%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VSS	VEU	Difference
Volatility (1M) Calculated over the trailing 1-month period	5.10%	5.31%	-0.21%
Volatility (6M) Calculated over the trailing 6-month period	14.40%	15.10%	-0.70%
Volatility (1Y) Calculated over the trailing 1-year period	16.22%	16.96%	-0.74%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	16.68%	16.37%	+0.31%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	17.14%	17.08%	+0.06%

VSS vs. VEU - Expense Ratio Comparison

VSS has a 0.07% expense ratio, which is higher than VEU's 0.04% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VSS vs. VEU - Dividend Comparison

VSS's dividend yield for the trailing twelve months is around 3.31%, more than VEU's 2.56% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VEU Vanguard FTSE All-World ex-US ETF	2.56%	3.09%	3.24%	3.32%	3.12%	3.08%	2.00%	3.10%	3.27%	2.66%	2.96%	2.95%
VSS Vanguard FTSE All-World ex-US Small-Cap ETF	3.31%	3.39%	3.44%	3.14%	2.30%	2.74%	1.90%	3.25%	2.80%	2.83%	2.93%	2.66%

Frequently Asked Questions

Can I hold both VSS and VEU in my portfolio?

With a correlation of 0.93, VSS and VEU 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, VSS or VEU?

VEU has higher volatility (5.31%) compared to VSS (5.10%). In terms of maximum drawdown, VSS dropped -43.51% vs VEU's -61.52%.

Which ETF is better, VSS or VEU?

On 10-year performance, VEU leads with 9.66% vs 7.53% for VSS. On fees, VEU is cheaper at 0.04% per year. On volatility, VSS has been the lower-risk option at 5.10%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VSS or VEU?

Over the 10-year period, VEU has performed better with a 9.66% return vs 7.53%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VSS or VEU?

VEU is cheaper with a 0.04% expense ratio, compared with 0.07% for VSS.

Which ETF pays a higher dividend yield, VSS or VEU?

VSS has the higher dividend yield at 3.31%, compared with 2.56% for VEU.

What is the main difference between VSS and VEU?

VSS is categorized as Foreign Small & Mid Cap Equities, while VEU is Foreign Large Cap Equities. VSS tracks FTSE Global Small Cap ex US Index, while VEU tracks FTSE All-World ex US Index. Their fees differ too: 0.07% for VSS and 0.04% for VEU.

Which has better risk-adjusted returns?

VEU currently has the higher Sharpe Ratio (1.66 vs 1.02), 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.