VFMF vs VYM

VFMFBVanguard U.S. Multifactor ETF

VYMAVanguard High Dividend Yield ETF

In short

VFMF Three factor bets in one Vanguard wrapper: a quantitative model sifts the broad U.S. market down to roughly 600 stocks tilted toward momentum, quality and value, for 0.18% a year (about half the going rate in the multifactor aisle).

VYM The no-frills dividend workhorse. VYM buys the higher-yielding end of the US market, roughly 600 names, for four basis points: no quality screen, no dividend-growth-streak test, just yield, at scale since 2006.

Stated mandate

VFMF Seeks long-term capital appreciation by using a quantitative model to build a diversified U.S. common-stock portfolio with exposure to momentum, quality, and value characteristics.

VYM The Fund seeks to track a benchmark index measuring the investment return of common stocks from companies characterized by high dividend yields.

Why people hold it

• VFMF Costs 0.18% a year against a 0.32% median for its multifactor peer group. Unusually cheap for a strategy run by a quant model rather than a plain index copy.
• Momentum, quality and value in a single ticker, so there is no bolting three single-factor funds together and rebalancing them yourself.
• Roughly 600 names drawn from the Russell 3000 universe. The wager is on factor tilts across a wide bench, not on a concentrated handful of stocks.
• Sits in the upper tier of a crowded multifactor field on our review, with its cost and portfolio build doing the heavy lifting.

• VYM Four basis points a year, against a peer-group median near 0.32%. Cheaper than cohort neighbors VONV (0.06%) and FNDX (0.25%).
• Running since 2006 and now a multi-billion-dollar fund that trades actively, so ordinary orders tend to fill at tight spreads.
• Simple mandate: track the FTSE High Dividend Yield Index of US common stocks screened on yield. No manager discretion, no options overlay, plain 1940-Act fund.vanguard.com
• Pays quarterly, and among 100-plus value and multifactor rivals it stands as one of the strongest overall packages in the group.

Worth knowing

• VFMF Trades lighter than the household-name factor funds. Spreads and limit orders matter more here than with a mega-cap index ETF.
• The model targets factor characteristics, not the Russell 3000's weights, so results can wander well away from the plain broad market for long stretches.
• If you want one tilt rather than three, Vanguard siblings run cheaper: VONV at 0.06% and VYM at 0.04%.

• VYM The screen is yield, not payout growth or dividend quality, so a company can qualify simply because its share price fell.
• This is a value slice by design, tilted to established payers, so it behaves differently from a total US market fund.
• Roughly 600 holdings, but weight leans toward the largest payers, so the top of the roster does more of the work than the count suggests.

Full VFMF profile⁠

Full VYM profile⁠