BND vs VYM
Vanguard Total Bond Market ETF vs Vanguard High Dividend Yield ETF
Quick Verdict
BND has a lower expense ratio. VYM delivered stronger 1-year returns. BND offers more diversification with 10790 holdings.
Side-by-Side Comparison
| Metric | BND | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.04% | |
| AUM | $159.8B | $79.0B | |
| Dividend Yield | 3.94% | 2.86% | |
| Holdings | 17,528 | 568 | |
| YTD Return | -0.26% | +15.80% | |
| 1Y Return | +2.01% | +26.12% | |
| 3Y Return (annualized) | +3.97% | +18.25% | |
| 5Y Return (annualized) | -0.25% | +12.51% | |
| Volatility (annualized) | 4.6% | 14.6% | |
| Max Drawdown | -19.6% | -58.8% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Apr 3, 2007 | Nov 10, 2006 |
BND vs VYM Performance
Vanguard Total Bond Market ETF (BND) is a ETF from Vanguard (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year BND returned +2.01% while VYM returned +26.12%. Year to date, BND is down 0.26% versus a gain of 15.80% for VYM.
Over three years, BND compounded at +3.97% per year against +18.25% for VYM; over five years the annualized figures are -0.25% and +12.51% respectively. Across the full 19-year window we track, VYM has the edge at +7.07% annualized vs +0.69%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.6% compared with 4.6% for BND. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -19.6% for BND and -58.8% for VYM. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.22. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
BND charges 0.03% per year while VYM charges 0.04%. On a $10,000 position that is $3 vs $4 annually, a gap of $1 per year that compounds over a long holding period. On income, BND currently yields 3.94% against 2.86% for VYM.
Holdings Overlap
BND and VYM share 5 holdings out of 11343 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, BND or VYM?
BND has an expense ratio of 0.03% while VYM charges 0.04%. BND is the cheaper option. On a $10,000 investment, that is $1 per year of difference.
Which performed better, BND or VYM?
Over the past year BND returned +2.01% vs +26.12% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (19 years), BND annualized +0.69% vs +7.07% for VYM. Past performance does not guarantee future results.
Which is riskier, BND or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 4.6% for BND. Worst drawdown: BND -19.6% vs VYM -58.8%.
Should I hold both BND and VYM?
BND and VYM have a monthly-return correlation of 0.22, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between BND and VYM?
BND and VYM share 5 common holdings with a 0.0% weight overlap. Combined, they hold 11343 unique securities.
Which pays a higher dividend, BND or VYM?
BND yields 3.94% while VYM yields 2.86%, so BND currently pays the higher dividend yield.
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