ETF Evaluator: Vanguard Energy ETF (VDE) Follow This ETF

Vanguard Energy ETF Overview

Vanguard Energy ETF (VDE) is a passively managed Sector Equity Equity Energy exchange-traded fund (ETF). Vanguard launched the ETF in 2004.

The investment seeks to track the performance of the MSCI US Investable Market Index (IMI)/Energy 25/50. The fund employs an indexing investment approach designed to track the performance of the index, an index made up of stocks of large, mid-size, and small U.S. companies within the energy sector, as classified under the GICS. The Advisor attempts to replicate the target index by seeking to invest all, or substantially all, of its assets in the stocks that make up the index, in order to hold each stock in approximately the same proportion as its weighting in the index. The fund is non-diversified.

About Vanguard Energy ETF (VDE)

There are 2 members of the management team with an average tenure of 1.36 years: Aaron Choi (2025) and Chris Nieves (2025). Management tenure is more important for actively managed ETFs than passive index ETFs.

The ETF has 2 primary benchmarks: MSCI US Investable Market 2500 GR USD index with a weighting of 100% and MSCI US IMI/Energy 25-50 GR USD index with a weighting of 100%. Vanguard Energy ETF has 118 securities in its portfolio. The top 10 holdings constitute 63.7% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a nondiversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.

Vanguard Energy ETF is part of the Equity global asset class and is within the Sector Equity ETF group. Vanguard Energy ETF has 0.4% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 98.9% There is 0.4% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 0.0% (0.0% domestic bond, 0.0% foreign bond and 0.0% convertible bond). Vanguard Energy ETF has 0.2% of the portfolio in cash.

Assets Under Management

The fund has $9 billion in total assets, which is above the $1 billion average for the Equity Energy category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.

VDE Performance and Fees

The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Vanguard Energy ETF expense ratio is low compared to funds in the Equity Energy category. Vanguard Energy ETF has an expense ratio of 0.09%, which is 84% lower than its category average, making the fund expense ratio grade a A. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.

High portfolio turnover can translate to higher expenses and lower aftertax returns. Vanguard Energy ETF has a portfolio turnover rate of 11%, which indicates that it holds its assets around / 0.1 years. By way of comparison, the average portfolio turnover is 23% for the Equity Energy category.

Recently, in the month of June 2026, Vanguard Energy ETF returned -4.8%, which earned it a grade of C, as the Equity Energy category had an average return of -4.9%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.

Vanguard Energy ETF has a trailing yield of 2.68%, which is above the 2.42% category average. The fund normally distributes its income quarterly and its capital gains annually.

It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.

Vanguard Energy ETF Grades

Year to date, the ETF has returned 20.9%, 0.3 percentage points better than the category, which translates into a grade of C. The fund has returned 29.8% over the past year (grade of C), 13.4% over the past three years (grade of C) and 18.7% per year over the past five years (grade of A) and 8.4% per year over the past 10 years (grade of B).

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