High yield vs total market
VYM vs VTI after taxes
Compare a high-dividend-yield US fund against a total US market fund with distribution tax character in view.
Modeled result
From 2007 to 2025, VTI finished ahead of VYM before tax and retained about $15,632 more in estimated end-date sale proceeds after taxes paid during the test, from the same $10,000 start.
Historical model
Growth of $10,000
2007-01-03 to 2025-12-31
| Date | VYM | VTI |
|---|---|---|
| Approx. Jan 2007 | $10,000 | $10,000 |
| Approx. Aug 2007 | $10,474 | $10,578 |
| Approx. Dec 2007 | $10,141 | $10,442 |
| Approx. Aug 2008 | $9,015 | $9,534 |
| Approx. Dec 2008 | $6,819 | $6,376 |
| Approx. Jul 2009 | $7,154 | $7,488 |
| Approx. Nov 2009 | $8,052 | $8,418 |
| Approx. Jul 2010 | $7,890 | $8,370 |
| Approx. Nov 2010 | $8,913 | $9,663 |
| Approx. Jul 2011 | $10,089 | $10,849 |
| Approx. Nov 2011 | $10,006 | $10,359 |
| Approx. Jun 2012 | $10,904 | $11,047 |
| Approx. Oct 2012 | $11,672 | $11,807 |
| Approx. Jun 2013 | $13,419 | $13,633 |
| Approx. Oct 2013 | $13,709 | $14,444 |
| Approx. May 2014 | $15,788 | $16,471 |
| Approx. Sep 2014 | $16,386 | $17,004 |
| Approx. May 2015 | $17,500 | $18,530 |
| Approx. Sep 2015 | $15,871 | $17,164 |
| Approx. May 2016 | $17,837 | $18,094 |
| Approx. Aug 2016 | $18,846 | $19,258 |
| Approx. Apr 2017 | $20,422 | $21,259 |
| Approx. Aug 2017 | $21,175 | $22,234 |
| Approx. Apr 2018 | $22,372 | $23,980 |
| Approx. Aug 2018 | $23,675 | $26,136 |
| Approx. Mar 2019 | $23,995 | $26,075 |
| Approx. Jul 2019 | $25,187 | $28,010 |
| Approx. Mar 2020 | $21,662 | $25,105 |
| Approx. Jul 2020 | $22,832 | $29,691 |
| Approx. Mar 2021 | $29,009 | $38,214 |
| Approx. Jun 2021 | $31,878 | $42,102 |
| Approx. Feb 2022 | $34,418 | $43,057 |
| Approx. Jun 2022 | $31,953 | $35,813 |
| Approx. Feb 2023 | $35,070 | $40,229 |
| Approx. Jun 2023 | $32,653 | $40,665 |
| Approx. Jan 2024 | $36,773 | $47,385 |
| Approx. May 2024 | $39,962 | $51,812 |
| Approx. Jan 2025 | $43,031 | $57,346 |
| Approx. May 2025 | $42,817 | $55,588 |
| Approx. Dec 2025 | $49,820 | $67,627 |
| Holding | Before tax | Value after taxes paid | If sold at end | Max drawdown |
|---|---|---|---|---|
VYM High dividend (VYM) | $49,820 | $43,539 | $39,904 | -56.98% |
VTI Total market (VTI) | $67,627 | $62,458 | $55,537 | -55.45% |
VYM
High dividend (VYM)
- After-tax if sold at end
- $39,904
- Before tax
- $49,820
- Value after taxes paid
- $43,539
- Max drawdown
- -56.98%
VTI
Total market (VTI)
- After-tax if sold at end
- $55,537
- Before tax
- $67,627
- Value after taxes paid
- $62,458
- Max drawdown
- -55.45%
Detailed metrics
| Holding | Pre-tax value | Pre-tax CAGR | Max drawdown | Value after taxes paid | Tax paid | Embedded tax | If sold at end | CAGR if sold |
|---|---|---|---|---|---|---|---|---|
High dividend (VYM) VYM | $49,820 | 8.82% | -56.98% | $43,539 | $2,676 | $3,635 | $39,904 | 7.56% |
Total market (VTI) VTI | $67,627 | 10.59% | -55.45% | $62,458 | $1,754 | $6,922 | $55,537 | 9.45% |
Assumptions
$10,000 lump sum; distributions reinvested; monthly rebalancing; 2007-01-03 to 2025-12-31.
Tax profile: Single filer, $150,000 income, taxable account, HIFO lots, 2026 federal brackets, no state tax.
FAQ
- Is a high-dividend fund more tax-efficient?
- In most taxable accounts the opposite holds. A higher yield means the fund distributes more return each year, and you pay tax on it instead of deferring it as unrealized gains. The net after-tax effect still depends on total return and your bracket.
- Where does a high-dividend fund fit better?
- In a tax-advantaged account, distributions are not taxed yearly, so the yield difference carries no annual tax cost. The taxable view is where the difference appears as tax drag.
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