Is Vanguard Financials or State Street Bank the Superior ETF for Your Evolving Portfolio?
KBE targets banks exclusively with higher recent returns, while VFH offers broader financial sector exposure at a fraction of the cost.
Overview
Investors choosing between State Street SPDR S&P Bank ETF (NYSEMKT:KBE) and Vanguard Financials ETF (NYSEMKT:VFH) are weighing a narrow, equal-weighted focus on banks against a broad, market-cap-weighted financial sector strategy.
Both funds provide targeted exposure to financial companies, but their scopes and costs differ significantly. KBE targets the banking sub-sector specifically, including regional and diversified institutions. VFH offers a wider net, capturing insurance, investment banking, and payment processors alongside traditional banks, with $13.9 billion in assets under management (AUM).
Details
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield as of the close of trading on July 27.
Source
Originally published at www.fool.com.