PREF vs VYM
Principal Spectrum Preferred Securities Active ETF vs Vanguard High Dividend Yield ETF
Which is better, PREF or VYM?
Preferred Stock against Large Cap Value.
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | PREF | VYM |
|---|---|---|
| Expense Ratio | 0.55% | 0.04%Best |
| AUM | $1.9B | $78.9B |
| Dividend Yield | 5.48% | 2.37% |
| Holdings | 338 | 608 |
| YTD Return | -0.31% | +11.83%Best |
| 1Y Return | +1.38% | +15.96%Best |
| 3Y Return (annualized) | +8.67% | +18.60%Best |
| 5Y Return (annualized) | +2.33% | +11.51%Best |
| Volatility (annualized) | 7.8%Best | 14.8% |
| Max Drawdown | -23.3%Best | -35.7% |
| $10,000 over 5 years | $11,221 | $17,241Best |
| Fund Family | Principal Funds | Vanguard (US) |
| Category | Allocation/Balanced | Equity |
| Style | Preferred Stock | Large Cap Value |
| Inception | Jul 10, 2017 | Nov 10, 2006 |
Not shown on this pair: Top 10 Weight.
Volatility and max drawdown are measured over the window both funds cover: Jul 11, 2017 to Oct 14, 2026 (9.3 years).
PREF vs VYM growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view covers the 9.3 years both funds cover.
PREF vs VYM Performance
Principal Spectrum Preferred Securities Active ETF (PREF) is an ETF from Principal Funds and Vanguard High Dividend Yield ETF (VYM) is an ETF from Vanguard (US). Over the past year PREF returned +1.38% while VYM returned +15.96%. Year to date, PREF is down 0.31% versus a gain of 11.83% for VYM.
Over three years, PREF compounded at +8.67% per year against +18.60% for VYM; over five years the annualized figures are +2.33% and +11.51% respectively. Across the full 9-year window we track, VYM has the edge at +9.95% annualized vs +1.83%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.8% compared with 7.8% for PREF. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -23.3% for PREF and -35.7% for VYM. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.67. They move together some of the time, and apart the rest.
Fees and Cost Over Time
PREF charges 0.55% per year while VYM charges 0.04%. On a $10,000 position that is $55 vs $4 annually, a gap of $51 per year that compounds over a long holding period. On income, PREF currently yields 5.48% against 2.37% for VYM.
Holdings Overlap
We hold position weights for 1 holding in PREF and 602 in VYM, totalling 10.1% and 100.0% of the two funds. The two books name no position in common, so there is no overlap percentage to show.
0 positions in common, counted across the 1 positions we hold weights for in PREF and 602 in VYM, against full books of 338 and 608.
You are not choosing between two funds in isolation.
Whichever of PREF and VYM you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, PREF or VYM?
PREF has an expense ratio of 0.55% while VYM charges 0.04%. VYM is the cheaper option, by $51 a year on a $10,000 investment.
Which performed better, PREF or VYM?
Over the past year PREF returned +1.38% vs +15.96% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (9 years), PREF annualized +1.83% vs +9.95% for VYM. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, PREF or VYM?
VYM has been the more volatile fund at 14.8% annualized versus 7.8% for PREF. Worst drawdown: PREF -23.3% vs VYM -35.7%.
Should I hold both PREF and VYM?
PREF and VYM have a monthly-return correlation of 0.67, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, PREF or VYM?
PREF yields 5.48% while VYM yields 2.37%, so PREF currently pays the higher dividend yield.
Is VYM better than PREF?
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window. Which one suits a particular account depends on what it is for. This is information, not a recommendation.