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VTI vs DFAC: What’s The Difference? 2023

ByConrad Golly Updated on

The Vanguard Total Stock Market ETF (VTI) and the Dimensional Fund Advisors (DFAC) are both interesting ETFs. VTI tracks CRSP US Total Market Index and DFAC tracks ACTIVE – No Index. So, what’s the difference between VTI vs DFAC? And which fund is better?

VTI vs DFAC: The expense ratio of VTI is 0.03% and DFAC is 0.17%. VTI’s biggest holding is Apple Inc and DFAC’s biggest holding is Apple Inc. Overall, VTI has provided 0.52% Higher returns than DFAC over the past ten years.

In this article, we’ll compare VTI vs DFAC. We’ll look at holdings and performance, as well as at their portfolio growth and annual returns. Moreover, I’ll also discuss VTI’s and DFAC’s industry exposure, risk metrics, fund composition and examine how these affect their overall returns.

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Summary VTI vs DFAC

VTI vs DFAC

DFAC vs VTI Table

BND IUSB
Name Vanguard Total Stock Market ETF Dimensional Fund Advisors
Category Large Blend Large Growth
Issuer Vanguard Dimensional
AUM $1.27T 20.71B
Avg. Return 12.54% 12.02%
Div. Yield 1.57% 1.34%
Expense Ratio 0.03% 0.17%
The Vanguard Total Stock Market ETF (VTI) is a CRSP US Total Market Index fund that is issued by Vanguard. It currently has $1.27T total assets under management and has yielded an average annual return of 12.54% over the past 10 years. The fund has a dividend yield of 1.57% with an expense ratio of 0.03%.
The Dimensional Fund Advisors (DFAC) is a ACTIVE – No Index that is issued by Dimensional. It currently has 20.71B total assets under management and has yielded an average annual return of 12.02% over the past 10 years. The fund has a dividend yield of 1.34% with an expense ratio of 0.17%.

VTI’s dividend yield is Higher than that of DFAC (1.57% vs 1.34%). Also, VTI yielded on average 0.52% Higher per year over the past decade (12.54% vs 12.02%). The expense ratio of VTI is -0.14% percentage points Lower than DFAC’s (0.03% vs 0.17%).

Fund Composition VTI vs DFAC

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Industry Exposure Table vs VTI

Industry Chart

VTI DFAC
Technology 27.62% 0.2385
Industrials 9.07% 0.1391
Energy 4.08% 0.0617
Communication Services 7.97% 0.0636
Utilities 2.61% 0.0186
Healthcare 13.73% 0.124
Consumer Defensive 6.27% 0.062
Real Estate 3.13% 0.0031
Financial Services 12.12% 0.1406
Consumer Cyclical 10.35% 0.1101
Basic Materials 2.37% 0.0387
The Vanguard Total Stock Market ETF (VTI) has the most exposure to the Technology sector at 27.62%. This is followed by Healthcare and Financial Services at 13.73% and 12.12% respectively. Basic Materials (2.37%), Utilities (2.61%), and Real Estate (3.13%) only make up 8.11% of the fund’s total assets.
VTI’s middle weighted sectors is made up with moderate exposure to Energy, Consumer Defensive, Communication Services, Industrials, and Consumer Cyclical stocks at 4.08%, 6.27%, 7.97%, 9.07%, and 10.35%.
The Dimensional Fund Advisors (DFAC) has the most exposure to the Technology sector at 0.2385. This is followed by Financial Services and Industrials at 0.1406 and 0.1391 respectively. Real Estate (0.0084), Utilities (0.0186), and Basic Materials (0.0387) only make up 0.0657 of the fund’s total assets.
DFAC’s middle weighted sectors is made up with moderate exposure to Energy, Consumer Defensive, Communication Services, Consumer Cyclical, and Healthcare stocks at 0.0617, 0.062, 0.0636, 9.07%, and 10.35%.

VTI is 3.77% More exposed to the Technology sector than DFAC (27.62% vs 23.85%). VTI’s exposure to Healthcare and Financial Services stocks is 1.33% More and -1.94% Less respectively (13.73% vs. 12.40%) and (12.12% vs. 14.06%).

In total, VTI’s bottom three industries, Real Estate, Utilities, and Basic Materials also make up 1.54% Higher of the fund’s holdings compared to DFAC’s bottom three industries. (8.11% vs. 0.0657).

Holdings Vanguard Total Stock Market ETF (VTI)

VTI Holdings Weight
Apple Inc 6.53%
Microsoft Corp 5.99%
Amazon.com Inc 2.57%
NVIDIA Corp 2.17%
Alphabet Inc Class A 1.80%
Alphabet Inc Class C 1.53%
Meta Platforms Inc Class A 1.44%
Berkshire Hathaway Inc Class B 1.38%
Tesla Inc 1.34%
UnitedHealth Group Inc 1.12%
 
VTI’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, NVIDIA Corp, and Alphabet Inc Class A at 6.53%, 5.99%, 2.57%, 2.17%, and 1.80%.
Alphabet Inc Class C (1.53%), Meta Platforms Inc Class A (1.44%), and Berkshire Hathaway Inc Class B (1.38%) have a slightly smaller but still significant weight. Tesla Inc and UnitedHealth Group Inc are also represented in the VTI’s holdings at 1.34% and 1.12%.

Holdings Dimensional Fund Advisors (DFAC)

VTI Holdings Weight
Apple Inc 0.0546
Microsoft Corp 0.0474
Amazon.com Inc 0.0139
Meta Platforms Inc Class A 0.0138
Exxon Mobil Corp 0.0117
Berkshire Hathaway Inc Class B 0.0094
Alphabet Inc Class A 0.009
JPMorgan Chase & Co 0.0088
Broadcom Inc 0.0088
Johnson & Johnson 0.0084
VTI’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Meta Platforms Inc Class A, and Exxon Mobil Corp at 0.0546, 0.0474, 0.0139, 0.0138, and 0.0117.
Berkshire Hathaway Inc Class B (0.0094), Alphabet Inc Class A (0.009), and JPMorgan Chase & Co (0.0088) have a slightly smaller but still significant weight. Broadcom Inc and Johnson & Johnson are also represented in the ’s holdings at 0.0088 and 0.0084.

Risk Analysis VTI vs DFAC

SCHD SDY
Mean Return 1.09 1.36
R-squared 99.08 94.92
Std. Deviation 18.17 18.38
Alpha -0.8 1.22
Beta 1.01 0.99
Sharpe Ratio 0.64 0.8
Treynor Ratio 10.57 14.36
The Vanguard Total Stock Market ETF has a Standard Deviation of 18.17 with a Alpha of -0.8 and a Treynor Ratio of 10.57. Its Sharpe Ratio is 0.64 while VTI’s Beta is 1.01. Furthermore, the fund has a Mean Return of 1.09 and a R-squared of 99.08.
The DFAC has a R-squared of 94.92 with a Mean Return of 1.36 and a Standard Deviation of 18.38. Its Sharpe Ratio is 0.8 while DFAC’s Alpha is 1.221. Furthermore, the fund has a Beta of 0.99 and a Treynor Ratio of 14.36.

Performance VTI vs DFAC

Annual Returns VTI vs DFAC

Year VTI DFAC
2022 -19.51% -0.1493
2021 25.67% 0.2753
2020 21.03% 0.158
2019 30.67% 0.2954
2018 -5.21% -0.0943
2017 21.21% 0.1882
2016 12.83% 0.1631
2015 0.36% -0.0253
2014 12.54% 0.0956
2013 33.45% 0.3755
2012 16.45% 0.1793
2011 0.97% -0.0196
VTI had its best year in 2013 with an annual return of 33.45%. VTI’s worst year over the past decade yielded -19.51% and occurred in 2022. In most years the Vanguard Total Stock Market ETF provided moderate returns such as in 2019, 2021, and 2017 where annual returns amounted to 31.35%, 28.78%, and 21.77% respectively.
The year 2013 was the strongest year for DFAC, returning 0.3755 on an annual basis. The poorest year for DFAC in the last ten years was 2022, with a yield of -0.1493. Most years the Dimensional Fund Advisors has given investors modest returns, such as in 2019, 2021, and 2017, when gains were 27.32%, 17.56%, and 16.26% respectively.

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Performance Comparison VTI vs DFAC

Fund Initial Balance Final Balance CAGR
VTI $10,000 $29,488.88 12.77%
DFAC $10,000 $29,249.73 12.67%
A $10,000 investment in VTI would have resulted in a final balance of $29,488.88. This is a profit of $19,488.88 over 10 years and amounts to a compound annual growth rate (CAGR) of 12.77%.
With a $10,000 investment in DFAC, the end total would have been $29,249.73. This equates to a $19,249.73 profit over 10 years and a compound annual growth rate (CAGR) of 12.67%.
DFAC’s CAGR is -0.10% Lower than that of VTI and as a result, would have yielded -$239.14 Less on a $10,000 investment. Thus, DFAC Underperformed VTI by -$23.91 annually.
Conrad Golly
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