Generated April 2026 from current fund data.
Overview
VEA and VTI are both Vanguard equity index ETFs with rock-bottom fees, but they track entirely different markets. VEA holds developed markets outside the U.S. (Europe, Japan, Australia, Canada) via the FTSE index; VTI holds the entire U.S. stock market from large-cap tech down to small-cap names through the CRSP index. They're the international and domestic halves of a global portfolio.
How they differ
The core difference is geography. VEA gives you non-U.S. developed markets; VTI gives you everything traded on U.S. exchanges. That leads to vastly different holding profiles—VEA leans European financials and industrials, while VTI is tech-heavy. VEA yields 2.12% versus VTI's 1.08%, reflecting the slower growth profile of developed international markets. Both charge 0.03% in fees, making cost a non-factor. VTI is roughly seven times larger ($1.99 trillion in AUM versus VEA's $282 billion), which translates to tighter bid-ask spreads and faster trade execution on VTI, though both are highly liquid.
Who each is best for
VEA: U.S.-based investors seeking geographic diversification away from the dollar and American equities, or those who already own significant U.S. exposure and want to reduce home-country bias in a tax-advantaged account where the 2.12% yield won't trigger reinvestment drag.
VTI: Core portfolio builders who want maximum simplicity—one fund covering 3,500+ U.S. stocks across all sizes and sectors—or investors who prefer to avoid the currency and geopolitical risks that come with international holdings.
Key risks to know
- Currency risk (VEA only): The fund's non-dollar holdings create foreign exchange exposure. A strengthening dollar erodes the dollar value of VEA's holdings, independent of stock performance.
- Economic sensitivity: VEA carries higher exposure to industrials, materials, and financials—sectors sensitive to global growth slowdowns and interest-rate swings. VTI, more technology-weighted, has different cyclicality.
- Valuation gap: Developed international markets typically trade at lower price-to-earnings multiples than the U.S., which may reflect structural growth headwinds or may represent value—history doesn't settle this.
- Liquidity (minor): VTI's much larger AUM means fractionally better execution in extreme market dislocations, though both funds are highly tradable.
Bottom line
If you want a single holding that covers the entire U.S. market and don't need international diversification, VTI is the obvious choice—simpler, larger, lower yield drag. If you're building a globally diversified portfolio and already have U.S. coverage elsewhere, VEA adds geographic balance and a higher income stream, accepting currency risk in exchange. Neither fund is a substitute for the other; they're complements. Past performance in either geography doesn't predict future regional outperformance.
AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.
