VFH vs. KRE: Which Financial Sector ETF Is the Better Buy for Investors?
VFH's diversified portfolio has delivered better returns over the last five years than KRE, with about half the maximum drawdown -- although KRE has had the stronger run recently.
Overview
The Vanguard Financials ETF (NYSEMKT:VFH) gives investors diversified, low-cost exposure to the broad financial services sector, while the State Street SPDR S&P Regional Banking ETF (NYSEMKT:KRE) makes a targeted bet on the regional banking industry.
These two funds provide very different ways to invest in the financial sector. VFH's roster includes global banking giants and payment networks, while KRE isolates smaller, domestic lenders. Comparing their portfolios and cost structures can help investors decide which approach best fits their long-term strategy.
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-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
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Originally published at www.fool.com.