Vanguard vs. iShares: Is VNQ or ICF the Better U.S. REIT ETF to Buy?

Core Insights - The article compares iShares Select U.S. REIT ETF (ICF) and Vanguard Real Estate ETF (VNQ), highlighting VNQ's lower cost, broader portfolio, and higher yield, while ICF has a more concentrated focus and has slightly outperformed VNQ in five-year growth [2][10]. Cost and Size Comparison - ICF has an expense ratio of 0.32% and assets under management (AUM) of $1.9 billion, while VNQ has a lower expense ratio of 0.13% and AUM of $65.4 billion [4]. - VNQ offers a higher dividend yield of 3.86% compared to ICF's 2.49% [5][12]. Performance Comparison - Over five years, a $1,000 investment in ICF grew to $1,261, while the same investment in VNQ grew to $1,254 [6]. - Since 2004, VNQ has delivered annualized total returns of 7.2%, compared to ICF's 6.9% [11]. Portfolio Composition - VNQ holds 158 positions with top holdings in Welltower Inc., Prologis Inc., and American Tower Corp., providing diversified sector exposure [7]. - ICF is more concentrated with only 30 holdings, where its top ten stocks account for nearly 60% of its portfolio, increasing single-stock risk [8][12]. Investor Implications - VNQ's lower expense ratio and higher dividend yield make it more appealing for income-focused investors [10]. - Both funds have similar volatility levels, but VNQ's better returns and diversification may offer more potential for long-term growth [11][12].