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Should You Invest in the Vanguard Consumer Staples ETF (VDC)?
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Launched on 01/26/2004, the Vanguard Consumer Staples ETF (VDC - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Consumer Staples - Broad segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Vanguard. It has amassed assets over $6.64 billion, making it one of the largest ETFs attempting to match the performance of the Consumer Staples - Broad segment of the equity market. VDC seeks to match the performance of the MSCI US Investable Market Consumer Staples 25/50 Index before fees and expenses.
The MSCI US Investable Market Consumer Staples 25/50 Index measures the investment return of stocks in the consumer staples sector.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.10%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.22%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Staples sector--about 100% of the portfolio.
Looking at individual holdings, Procter & Gamble Co. (PG - Free Report) accounts for about 13.38% of total assets, followed by Walmart Inc. (WMT - Free Report) and Coca-Cola Co. (KO - Free Report) .
The top 10 holdings account for about 59.17% of total assets under management.
Performance and Risk
The ETF has lost about -3.53% and it's up approximately 16.02% so far this year and in the past one year (as of 02/24/2022), respectively. VDC has traded between $165.49 and $200.92 during this last 52-week period.
The ETF has a beta of 0.67 and standard deviation of 18.35% for the trailing three-year period, making it a medium risk choice in the space. With about 99 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Consumer Staples ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, VDC is a sufficient option for those seeking exposure to the Consumer Staples ETFs area of the market. Investors might also want to consider some other ETF options in the space.
IShares Global Consumer Staples ETF (KXI - Free Report) tracks S&P Global 1200 Consumer Staples Sector Index and the Consumer Staples Select Sector SPDR ETF (XLP - Free Report) tracks Consumer Staples Select Sector Index. IShares Global Consumer Staples ETF has $1.05 billion in assets, Consumer Staples Select Sector SPDR ETF has $15.14 billion. KXI has an expense ratio of 0.43% and XLP charges 0.10%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the Vanguard Consumer Staples ETF (VDC)?
Launched on 01/26/2004, the Vanguard Consumer Staples ETF (VDC - Free Report) is a passively managed exchange traded fund designed to provide a broad exposure to the Consumer Staples - Broad segment of the equity market.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.
Index Details
The fund is sponsored by Vanguard. It has amassed assets over $6.64 billion, making it one of the largest ETFs attempting to match the performance of the Consumer Staples - Broad segment of the equity market. VDC seeks to match the performance of the MSCI US Investable Market Consumer Staples 25/50 Index before fees and expenses.
The MSCI US Investable Market Consumer Staples 25/50 Index measures the investment return of stocks in the consumer staples sector.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.10%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 2.22%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Consumer Staples sector--about 100% of the portfolio.
Looking at individual holdings, Procter & Gamble Co. (PG - Free Report) accounts for about 13.38% of total assets, followed by Walmart Inc. (WMT - Free Report) and Coca-Cola Co. (KO - Free Report) .
The top 10 holdings account for about 59.17% of total assets under management.
Performance and Risk
The ETF has lost about -3.53% and it's up approximately 16.02% so far this year and in the past one year (as of 02/24/2022), respectively. VDC has traded between $165.49 and $200.92 during this last 52-week period.
The ETF has a beta of 0.67 and standard deviation of 18.35% for the trailing three-year period, making it a medium risk choice in the space. With about 99 holdings, it effectively diversifies company-specific risk.
Alternatives
Vanguard Consumer Staples ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, VDC is a sufficient option for those seeking exposure to the Consumer Staples ETFs area of the market. Investors might also want to consider some other ETF options in the space.
IShares Global Consumer Staples ETF (KXI - Free Report) tracks S&P Global 1200 Consumer Staples Sector Index and the Consumer Staples Select Sector SPDR ETF (XLP - Free Report) tracks Consumer Staples Select Sector Index. IShares Global Consumer Staples ETF has $1.05 billion in assets, Consumer Staples Select Sector SPDR ETF has $15.14 billion. KXI has an expense ratio of 0.43% and XLP charges 0.10%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.