BSV vs VNQ
Vanguard Short-Term Bond ETF vs Vanguard Real Estate ETF
Quick Verdict
BSV has a lower expense ratio. VNQ delivered stronger 1-year returns. BSV offers more diversification with 2787 holdings.
Side-by-Side Comparison
| Metric | BSV | VNQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.13% | |
| AUM | $44.8B | $38.2B | |
| Dividend Yield | 3.98% | 3.52% | |
| Holdings | 3,125 | 144 | |
| YTD Return | +0.58% | +13.55% | |
| 1Y Return | +2.35% | +14.03% | |
| 3Y Return (annualized) | +4.52% | +10.28% | |
| 5Y Return (annualized) | +1.61% | +2.27% | |
| Volatility (annualized) | 2.4% | 21.4% | |
| Max Drawdown | -9.0% | -75.8% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Apr 3, 2007 | Sep 23, 2004 |
BSV vs VNQ Performance
Vanguard Short-Term Bond ETF (BSV) is a ETF from Vanguard (US) and Vanguard Real Estate ETF (VNQ) is a ETF from Vanguard (US). Over the past year BSV returned +2.35% while VNQ returned +14.03%. Year to date, BSV is up 0.58% versus a gain of 13.55% for VNQ.
Over three years, BSV compounded at +4.52% per year against +10.28% for VNQ; over five years the annualized figures are +1.61% and +2.27% respectively. Across the full 19-year window we track, VNQ has the edge at +4.14% annualized vs +0.92%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VNQ has been the more volatile fund, with annualized monthly volatility of 21.4% compared with 2.4% for BSV. 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 -9.0% for BSV and -75.8% for VNQ. 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 0.27. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
BSV charges 0.03% per year while VNQ charges 0.13%. On a $10,000 position that is $3 vs $13 annually, a gap of $10 per year that compounds over a long holding period. On income, BSV currently yields 3.98% against 3.52% for VNQ.
Holdings Overlap
BSV and VNQ share 0 holdings out of 2931 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, BSV or VNQ?
BSV has an expense ratio of 0.03% while VNQ charges 0.13%. BSV is the cheaper option. On a $10,000 investment, that is $10 per year of difference.
Which performed better, BSV or VNQ?
Over the past year BSV returned +2.35% vs +14.03% for VNQ, so VNQ leads on 1-year performance. Over the longest common window we track (19 years), BSV annualized +0.92% vs +4.14% for VNQ. Past performance does not guarantee future results.
Which is riskier, BSV or VNQ?
VNQ has been the more volatile fund at 21.4% annualized versus 2.4% for BSV. Worst drawdown: BSV -9.0% vs VNQ -75.8%.
Should I hold both BSV and VNQ?
BSV and VNQ have a monthly-return correlation of 0.27, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between BSV and VNQ?
BSV and VNQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2931 unique securities.
Which pays a higher dividend, BSV or VNQ?
BSV yields 3.98% while VNQ yields 3.52%, so BSV currently pays the higher dividend yield.
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