These consumer staples ETFs are notable for their expense ratios, dividend yields, and focus within the sector. It’s interesting to see how these factors can affect an investor’s portfolio.
First, there’s the Vanguard Consumer Staples ETF (VDC +1.35%), which is recognized for its low costs and broad diversification. On the other hand, the First Trust Nasdaq Food & Beverage ETF (FTXG +1.16%) has higher costs but offers greater yields and is specifically focused on food and beverage companies.
Both funds aim for the consumer staples market, yet VDC takes a wider approach by including a variety of non-discretionary products, while FTXG is centered around food and beverage stocks. This makes for an interesting comparison to see if FTXG’s higher yield and specialized focus justify its costs and limited portfolio.
Snapshots (cost and size)
| metric | VDC | FTXG |
|---|---|---|
| Publisher | Vanguard | First Trust |
| expense ratio | 0.09% | 0.60% |
| 1 year returns (as of February 6, 2026) | 12.06% | 9.78% |
| dividend yield | 2.10% | 2.75% |
| beta | 0.64 | 0.52 |
| assets | $9.05 billion | $17.89 million |
Beta indicates the volatility of the price compared to the S&P 500, calculated from five years of weekly returns. One year’s return reflects total returns for the coming year.
With an expense ratio of just 0.09%, VDC is considerably more affordable than FTXG, which charges 0.60%. Yet, FTXG’s dividend yield of 2.75% beats VDC’s 2.10%, which might be a draw for those seeking higher income.
Comparing performance and risk
| metric | VDC | FTXG |
|---|---|---|
| Maximum drawdown (5 years) | (16.55%) | (21.71%) |
| $1,000 growth in 5 years | $1,385 | $925 |
what’s inside
FTXG is concentrated on the food and beverage sector, including only 31 stocks—91% in consumer defense, 7% in basic materials, and 2% in industrials. Notable holdings include PepsiCo (PEP +1.84%), Archer Daniels Midland (ADM +1.38%), and Mondelēz International (MDLZ 0.48%). With a track record spanning 9.4 years, it’s a stable option.
Conversely, VDC encompasses a larger spectrum of consumer staples, with 98% in consumer defensive sectors and 2% in consumer cyclicals. Among its top holdings are Walmart (WMT +3.42%), Costco (Fee +1.16%), and Procter & Gamble (PG +0.45%). With 103 holdings, VDC provides extensive diversification across food, beverages, as well as household and personal care products.
What this means for investors
Investing in the Vanguard Consumer Staples ETF (VDC) and the First Trust Nasdaq Food & Beverage ETF (FTXG) can yield stable income from the consumer staples sector. The decision typically hinges on whether one prefers the narrower focus of FTXG or the more extensive reach of VDC.
If you’re new to consumer staples or looking to expand your portfolio, VDC presents a stronger choice for a few reasons.
It offers higher annual returns, lower maximum drawdowns, and lower expense ratios. Additionally, VDC manages a grander portfolio with over $9 billion compared to FTXG’s modest $17.9 million, which enhances its liquidity.
Furthermore, VDC’s richer diversification (over 100 holdings) can provide stability during market downturns, whereas FTXG, being more specialized with just 31 holdings, might be at greater risk.
For investors eager to increase their food and beverage sector exposure and willing to accept the higher costs, FTXG has its appeal. But overall, VDC stands out as the more prudent choice.
