Vanguard Real Estate ETF vs State Street SPDR: Diversification or Cost
Vanguard is more diversified with a higher dividend yield, while State Street's concentrated 30-stock portfolio charges a lower expense ratio.
Overview
Comparing the Vanguard Real Estate ETF (NYSEMKT:VNQ) and the State Street Real Estate Select Sector SPDR ETF (NYSEMKT:XLRE) highlights a choice between the Vanguard fund's broad diversification and the SPDR fund's low-cost concentration.
Both funds target the U.S. real estate market, primarily through equity Real Estate Investment Trusts (REITs) that offer income and potential capital appreciation. While they share many top holdings, the Vanguard fund casts a wider net across the small- and mid-cap space, whereas the SPDR fund focuses exclusively on large-cap stocks.
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.
Source
Originally published at www.fool.com.