Vanguard Global ex-U.S. Real Estate ETF (NASDAQ:VNQI) and Xtrackers International Real Estate ETF (NYSEMKT:HAUZ) both provide investors with exposure to real estate companies outside the United States. These ETFs are attractive to those looking to diversify their portfolios beyond domestic property markets. In this comparison, we will explore the cost, performance, sector mix, and risk profile of each fund to help investors make informed decisions about international real estate equities.
Metrics Comparison:
HAUZ has an expense ratio of 0.10%, slightly lower than VNQI’s 0.12%. In terms of performance, HAUZ has a 1-year return of 21.27%, while VNQI has a return of 19.63%. When it comes to dividend yield, VNQI edges out HAUZ with a yield of 4.58% compared to HAUZ’s 4.34%. Both funds have a beta close to 0.70, indicating lower volatility relative to the overall market. In total assets under management (AUM), VNQI holds $3.53 billion, surpassing HAUZ’s $951.9 million.
Further Analysis:
VNQI focuses on global real estate excluding the U.S., holding 742 assets as of January 8, 2025. Top holdings include Goodman Group (ASX:GMG.AX), Mitsui Fudosan Co., Ltd. (JPX:8801.T), and Mitsubishi Estate Co., Ltd. (JPX:8802.T). The fund has been in existence for nearly 15 years and is the largest global real estate ETF in terms of total assets, trailing only the iShares Global REIT ETF (NYSEMKT:REET).
HAUZ has a similar makeup to VNQI but excludes companies from Pakistan and Vietnam along with the U.S., resulting in nearly 300 fewer total holdings. However, HAUZ is three years younger than VNQI.
Dividend Payout Frequency:
It is essential for investors to consider the dividend payout frequency of each ETF. HAUZ historically pays dividends semiannually, resulting in two dividend payments per year. On the other hand, VNQI switched from quarterly to annual payments in 2023. For those preferring quarterly dividend payouts, similar ETFs like SPDR Dow Jones Global Real Estate ETF (NYSEMKT:RWO) and REET may be more suitable.
Conclusion:
Both VNQI and HAUZ offer investors exposure to global real estate with similar metrics and performance. While HAUZ has slightly lower expenses, VNQI provides a higher dividend yield. Investors should also consider the payout frequency of dividends when choosing between the two ETFs. Ultimately, both funds present viable options for those looking to invest in international real estate equities.
