Should You Invest in the Vanguard Consumer Staples ETF (VDC)?

Designed to provide broad exposure to the Consumer Staples - Broad segment of the equity market, the Vanguard Consumer Staples ETF (VDC) is a passively managed exchange traded fund launched on January 26, 2004.

While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Consumer Staples - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 14, placing it in bottom 13%.

Index Details

The fund is sponsored by Vanguard. It has amassed assets over $7.57 billion, making it one of the largest ETFs attempting to match the performance of the Consumer Staples - Broad segment of the equity market. VDC seeks to match the performance of the MSCI US Investable Market Consumer Staples 25/50 Index before fees and expenses.

The MSCI US Investable Market Consumer Staples 25/50 Index measures the investment return of stocks in the consumer staples sector.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.09%, making it one of the cheaper products in the space.

It has a 12-month trailing dividend yield of 2.26%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Consumer Staples sector -- about 99.9% of the portfolio.

Looking at individual holdings, Costco Wholesale Corp (COST) accounts for about 13.04% of total assets, followed by Walmart Inc (WMT) and Procter & Gamble Co/the (PG).

The top 10 holdings account for about 44.87% of total assets under management.

Performance and Risk

Year-to-date, the Vanguard Consumer Staples ETF has gained about 4.27% so far, and is up about 6.09% over the last 12 months (as of 08/05/2025). VDC has traded between $204.89 and $226.16 in this past 52-week period.

The ETF has a beta of 0.57 and standard deviation of 12.41% for the trailing three-year period, making it a medium risk choice in the space. With about 111 holdings, it effectively diversifies company-specific risk.

Story Continues## Alternatives

Vanguard Consumer Staples ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, VDC is a sufficient option for those seeking exposure to the Consumer Staples ETFs area of the market. Investors might also want to consider some other ETF options in the space.

iShares U.S. Consumer Staples ETF (IYK) tracks Dow Jones U.S. Consumer Goods Index and the Consumer Staples Select Sector SPDR ETF (XLP) tracks Consumer Staples Select Sector Index. iShares U.S. Consumer Staples ETF has $1.38 billion in assets, Consumer Staples Select Sector SPDR ETF has $16.01 billion. IYK has an expense ratio of 0.4%, and XLP charges 0.08%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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Vanguard Consumer Staples ETF (VDC): ETF Research Reports

This article originally published on Zacks Investment Research (zacks.com).

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