VNQ: VANGUARD REAL ESTATE INDEX FUND ETF SHARES
ETF Education Report: Vanguard Real Estate Index Fund ETF Shares (VNQ)
What this ETF is trying to do
The Vanguard Real Estate Index Fund ETF Shares (VNQ) is an exchange-traded fund that focuses on real estate. Instead of buying just one building, this ETF holds many different companies involved in real estate. Based on its top holdings, it includes companies like Welltower Inc, Prologis Inc, and Equinix Inc. Because this list is partial, it only shows some of the 151 total holdings in the fund.
What the numbers show
It is important to understand that "price return" and "total return" are different. Price return only tracks how much the share price moves. Total return includes both the price change and the cash distributions paid out to investors.
• Year-to-Date (YTD): The price return is approximately 4.99%, while the total return is approximately 7.06%.
• One-Year: The price return is approximately 0.72%, while the total return is approximately 4.63%.
• Three-Year: The price return is approximately 14.59%, while the total return is approximately 29.05%.
The current price is $92.91. An estimated price from roughly one year ago was approximately $92.25.
Income and distribution explanation
This ETF pays out cash to investors, which is called a distribution. The distribution yield is approximately 3.74%. This means the cash paid out is about 3.74% of the ETF's price. These distributions usually happen quarterly, and there were 4 payouts in the last 12 months. While these payments provide cash income, they are not the same as total return.
NAV erosion explanation
"NAV erosion" refers to a decline in the Net Asset Value, or the actual value of the assets held by the fund. Some investors worry about this because if a fund's value drops too much, it can be hard to recover. For VNQ, the erosion-risk score is 94, which is labeled as "Stable / sideways." There is no severe erosion-risk flag for this ETF.
Pros
• The fund has a high income rating grade of "A."
• It shows a history of positive total returns over one, three, and five years.
Cons
• The one-year price return (0.72%) is much lower than the three-year price return, showing that share prices can change significantly over different time periods.
Beginner takeaway
When looking at an ETF like VNQ, remember that the price of a share and the cash it pays you (distributions) are two different things. Total return is the best way to see how both parts worked together. Also, always look at the erosion-risk score to understand how stable the fund's value has been.
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*Disclaimer: This report is for educational purposes only. It does not provide financial advice and does not recommend buying, selling, or holding any security.*
Top Holdings
Structured portfolio holdings supplied by the ETF data provider. These figures are not generated by the AI article.
| # | Holding | Ticker | Weight |
|---|---|---|---|
| 1 | VANGUARD REAL ESTATE II INDEX | VRTPX | 14.53% |
| 2 | WELLTOWER INC | WELL | 8.72% |
| 3 | PROLOGIS INC | PLD | 6.89% |
| 4 | EQUINIX INC | EQIX | 5.45% |
| 5 | AMERICAN TOWER CORP | AMT | 4.33% |
| 6 | SIMON PROPERTY GROUP INC | SPG | 3.64% |
| 7 | DIGITAL REALTY TRUST INC | DLR | 3.63% |
| 8 | REALTY INCOME CORP | O | 3.00% |
| 9 | PUBLIC STORAGE | PSA | 2.72% |
| 10 | VIVMARK RESIDENTIAL | VMRK | 2.46% |