FRA vs VYM
FRA vs VYM
Blackrock Floating Rate Income Strategies Fund Inc vs Vanguard High Dividend Yield ETF
Quick Verdict
VYM has a lower expense ratio. VYM delivered stronger 1-year returns. VYM offers more diversification with 558 holdings.
Side-by-Side Comparison
| Metric | FRA | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 2.97% | 0.04% | |
| AUM | $402M | $79.0B | |
| Dividend Yield | 13.06% | 2.86% | |
| Holdings | 469 | 568 | |
| YTD Return | -0.68% | +13.24% | |
| 1Y Return | -7.11% | +23.76% | |
| 3Y Return (annualized) | +7.57% | +16.97% | |
| 5Y Return (annualized) | +6.35% | +12.26% | |
| Volatility (annualized) | 14.5% | 14.6% | |
| Max Drawdown | -51.4% | -58.8% | |
| Fund Family | BlackRock, Inc. (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Oct 31, 2003 | Nov 10, 2006 |
FRA vs VYM Performance
Blackrock Floating Rate Income Strategies Fund Inc (FRA) is a ETF from BlackRock, Inc. (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year FRA returned -7.11% while VYM returned +23.76%. Year to date, FRA is down 0.68% versus a gain of 13.24% for VYM.
Over three years, FRA compounded at +7.57% per year against +16.97% for VYM; over five years the annualized figures are +6.35% and +12.26% respectively. Across the full 20-year window we track, VYM has the edge at +6.96% annualized vs +5.12%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.6% compared with 14.5% for FRA. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -51.4% for FRA and -58.8% for VYM. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.55. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FRA charges 2.97% per year while VYM charges 0.04%. On a $10,000 position that is $297 vs $4 annually, a gap of $293 per year that compounds over a long holding period. On income, FRA currently yields 13.06% against 2.86% for VYM.
Holdings Overlap
FRA and VYM share 0 holdings out of 779 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FRA or VYM?
FRA has an expense ratio of 2.97% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $293 per year of difference.
Which performed better, FRA or VYM?
Over the past year FRA returned -7.11% vs +23.76% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), FRA annualized +5.12% vs +6.96% for VYM. Past performance does not guarantee future results.
Which is riskier, FRA or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 14.5% for FRA. Worst drawdown: FRA -51.4% vs VYM -58.8%.
Should I hold both FRA and VYM?
FRA and VYM have a monthly-return correlation of 0.55, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FRA and VYM?
FRA and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 779 unique securities.
Which pays a higher dividend, FRA or VYM?
FRA yields 13.06% while VYM yields 2.86%, so FRA currently pays the higher dividend yield.
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