BSV vs VTBNX
Vanguard Short-Term Bond ETF vs Vanguard Total Bond Market II Index Fund Institutional Shares
Which is better, BSV or VTBNX?
Short Term Bond against Long Term High Quality.
VTBNX has a lower expense ratio. The two have moved almost in lockstep, correlation 0.93.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | BSV | VTBNX |
|---|---|---|
| Expense Ratio | 0.03% | 0.02%Best |
| AUM | $46.6B | $207.3B |
| Dividend Yield | 4.03% | 4.16% |
| Holdings | 3,169 | 15,871 |
| YTD Price Return | -3.29% | -5.41% |
| 1Y Price Return | -3.31% | -5.80% |
| 3Y Price Return (annualized) | +0.68% | +0.37% |
| 5Y Price Return (annualized) | -1.44% | -3.97% |
| Volatility (annualized) | 2.9%Best | 6.4% |
| Max Drawdown | -9.6%Best | -20.8% |
| Fund Family | Vanguard (US) | Vanguard (US) |
| Category | Fixed Income | Fixed Income |
| Style | Short Term Bond | Long Term High Quality |
| Inception | Apr 3, 2007 | Feb 17, 2009 |
Not shown on this pair: $10,000 over 5 years, Top 10 Weight.
A price return is not the return of a fund that pays its income out. The coupon or distribution never appears in the price, so the return rows carry no winner here. BSV currently yields 4.03% and VTBNX 4.16%.
Volatility and max drawdown are measured over the window both funds cover: Oct 4, 2021 to Oct 1, 2026 (5 years).
BSV vs VTBNX Performance
Vanguard Short-Term Bond ETF (BSV) is an ETF from Vanguard (US) and Vanguard Total Bond Market II Index Fund Institutional Shares (VTBNX) is a mutual fund from Vanguard (US). Over the past year BSV's price moved -3.31% and VTBNX's -5.80%, before the income each one paid out.
Over three years, BSV compounded at +0.68% per year against +0.37% for VTBNX; over five years the annualized figures are -1.44% and -3.97% respectively.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VTBNX has been the more volatile fund, with annualized monthly volatility of 6.4% compared with 2.9% 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 -9.6% for BSV and -20.8% for VTBNX. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.93. They move almost in lockstep, so holding both mostly duplicates the same exposure.
Fees and Cost Over Time
BSV charges 0.03% per year while VTBNX charges 0.02%. On a $10,000 position that is $3 vs $2 annually, a gap of $1 per year that compounds over a long holding period. On income, BSV currently yields 4.03% against 4.16% for VTBNX.
Structure and taxes
VTBNX is a mutual fund and BSV is an ETF. A mutual fund prices once a day at net asset value and may carry a purchase minimum. An ETF trades through the day at whatever the market pays for it.
In a taxable account the difference that usually matters is distributions. An ETF can meet redemptions in kind, so it rarely has to sell holdings and rarely passes a capital gain to the people who held it; a mutual fund that sells holdings to meet redemptions can distribute a realised gain at year end to everyone still in the fund, whether or not they sold anything themselves. In a tax-deferred account that difference largely disappears. Both are descriptions of how the two wrappers work, not a recommendation.
Tax-loss harvesting works on either wrapper.
Holdings Overlap
We hold position weights for 1,013 holdings in BSV and 12,623 in VTBNX, totalling 63.3% and 61.9% of the two funds. Neither is a share of a fund we can divide by, so no overlap percentage is shown here. Within what we can see, 874 positions appear in both.
874 positions in common, counted across the 1,013 positions we hold weights for in BSV and 12,623 in VTBNX, against full books of 3,169 and 15,871.
Top Shared Holdings
| Stock | Weight in BSV | Weight in VTBNX | Difference |
|---|---|---|---|
| T 3.5 01/31/28Us Treasury N/B 3.375 01/31/2028 | 1.11% | 0.38% | 0.73% |
| T 4 02/28/30Us Treasury 4.0% | 0.87% | 0.33% | 0.54% |
| T 0.875 11/15/30United States Treasury 0.88% 15-Nov-2030 | 0.78% | 0.26% | 0.52% |
| T 4.375 12/31/29Us Treasury N/B 12/29 4.375 | 0.76% | 0.22% | 0.54% |
| T 0.625 08/15/30Us Treasury 0.625% Aug 15, 2030 (USD) | 0.74% | 0.24% | 0.50% |
| T 1.125 02/15/31Us Treasury N/B 02/31 1.125 1.125% 15-Feb-2031 | 0.75% | 0.21% | 0.54% |
| T 1.625 05/15/31Treasury Note (Otr) 1.63% May 15, 2031 | 0.72% | 0.24% | 0.48% |
| T 3.875 07/31/30Us Treasury N/B 3.88% 31Jul2030 | 0.69% | 0.25% | 0.44% |
| T 3.5 09/30/29United States Treasury Note/Bond 3.5 2029-09-30 | 0.73% | 0.20% | 0.53% |
| T 4 07/31/29United States Treasury Note/Bond 4 07/31/2029 | 0.71% | 0.21% | 0.50% |
You are not choosing between two funds in isolation.
Whichever of BSV and VTBNX you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, BSV or VTBNX?
BSV has an expense ratio of 0.03% while VTBNX charges 0.02%. VTBNX is the cheaper option, by $1 a year on a $10,000 investment.
Which is riskier, BSV or VTBNX?
VTBNX has been the more volatile fund at 6.4% annualized versus 2.9% for BSV. Worst drawdown: BSV -9.6% vs VTBNX -20.8%.
Should I hold both BSV and VTBNX?
BSV and VTBNX have a monthly-return correlation of 0.93, so they move almost identically. What is left to separate them is the fee and the index each one tracks. This is information, not a recommendation.
Which pays a higher dividend, BSV or VTBNX?
BSV yields 4.03% while VTBNX yields 4.16%, so VTBNX currently pays the higher dividend yield.
Is it better to hold VTBNX or BSV in a taxable account?
BSV is an ETF and VTBNX is a mutual fund. An ETF can meet redemptions in kind, so it rarely distributes a capital gain to the people holding it. A mutual fund that sells holdings to meet redemptions can pass a realised gain to every holder at year end. In a tax-deferred account that difference largely disappears. This is information, not a recommendation.
Is VTBNX better than BSV?
VTBNX has a lower expense ratio. The two have moved almost in lockstep, correlation 0.93. Which one suits a particular account depends on what it is for. This is information, not a recommendation.