VNQ vs VYM: Correlation & Overlap
Measured on weekly returns over the past three years, Vanguard Real Estate ETF (VNQ) and Vanguard High Dividend Yield ETF (VYM) carry a correlation of 0.72, a strong link. The two funds also share 0.0% of their portfolios by weight.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are VNQ and VYM?
On 3 years of weekly data the VNQ/VYM correlation comes out at 0.72, strong. Little has changed lately, as the 1-year reading of 0.62 lands near the 3-year figure. The 5-year figure is 0.76, and annualized covariance runs at 145.8 %².
Among the 149 assets we track against VNQ, VYM ranks #49 by 3-year correlation. On 12-month performance VYM holds a 10.8-point edge, +10.3% against +21.1%. The rolling one-year correlation stayed in a tight band between 0.62 and 0.85 over the past three years, which points to a structural rather than episodic relationship.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
VNQ vs VYM: side by side
| VNQ (Vanguard Real Estate ETF) | VYM (Vanguard High Dividend Yield ETF) | |
|---|---|---|
| 1-year return | +10.3% | +21.1% |
| 5-year return | +9.5% | +76.6% |
| Volatility (ann.) | 16.6% | 12.3% |
| Beta vs S&P 500 | 0.59 | 0.69 |
| Max drawdown (3Y) | -17.5% | -14.5% |
| Dividend yield | 3.51% | 2.24% |
| Expense ratio | 0.13% | 0.04% |
| Assets under management | $73.1B | $99.2B |
| Sector / category | ETF · Real Estate | ETF · Dividend |
VNQ, Vanguard's Real Estate fund, carries $73.1B under management, 140 holdings, a 0.13% expense ratio, a 3.51% trailing dividend yield. VYM, Vanguard's Large Value fund, carries $99.2B under management, 604 holdings, a 0.04% expense ratio, a 2.24% trailing dividend yield.
Portfolio overlap between VNQ and VYM
The two portfolios are largely distinct: 0.0% of the funds' weight sits in the same underlying holdings (2 common positions). Correlation tells you they move together; overlap tells you why.
Largest positions held only by VNQ: VRTPX (14.54%), WELL (8.54%), PLD (7.04%), EQIX (5.25%), AMT (4.22%). Only by VYM: AVGO (7.37%), JPM (3.83%), XOM (2.63%), JNJ (2.51%), CSCO (1.87%).
Overlap = sum of the smaller of the two weights across common holdings, from issuer disclosures as of 2026-07-31. Top 2 common positions shown.
Year-by-year returns
| Year | VNQ | VYM |
|---|---|---|
| 2022 | -26.3% | -0.4% |
| 2023 | +11.9% | +6.6% |
| 2024 | +4.8% | +17.6% |
| 2025 | +3.2% | +15.4% |
| 2026 | +12.5% | +15.9% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are VNQ and VYM good diversifiers for each other?
Somewhat, no more. With 0.72 correlation, most large moves hit both names, and the diversification benefit stays modest.
FAQ
What is the correlation between VNQ and VYM?
Using weekly returns as of 2026-08-27: 0.72 over 3 years, with 0.62 over the last year and 0.76 over 5 years.
Is VYM a good diversifier for VNQ?
Somewhat, no more. With 0.72 correlation, most large moves hit both names, and the diversification benefit stays modest.
How much do VNQ and VYM overlap?
The two funds share 2 holdings amounting to 0.0% of weight, per issuer portfolio files dated 2026-07-31.
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Hubs: VNQ correlations · VYM correlations
