IAGG vs VXUS
IAGG vs VXUS
iShares Core International Aggregate Bond ETF vs Vanguard Total International Stock ETF
Quick Verdict
VXUS has a lower expense ratio. VXUS delivered stronger 1-year returns. VXUS offers more diversification with 7861 holdings.
Side-by-Side Comparison
| Metric | IAGG | VXUS | Winner |
|---|---|---|---|
| Expense Ratio | 0.07% | 0.05% | |
| AUM | $10.9B | $156.5B | |
| Dividend Yield | 3.63% | 2.60% | |
| Holdings | 8,021 | 8,747 | |
| YTD Return | -0.04% | +14.57% | |
| 1Y Return | -2.31% | +27.82% | |
| 3Y Return (annualized) | +3.08% | +19.27% | |
| 5Y Return (annualized) | -0.02% | +9.28% | |
| Volatility (annualized) | 4.1% | 15.1% | |
| Max Drawdown | -13.9% | -39.9% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Nov 10, 2015 | Jan 26, 2011 |
IAGG vs VXUS Performance
iShares Core International Aggregate Bond ETF (IAGG) is a ETF from iShares by BlackRock (US) and Vanguard Total International Stock ETF (VXUS) is a ETF from Vanguard (US). Over the past year IAGG returned -2.31% while VXUS returned +27.82%. Year to date, IAGG is down 0.04% versus a gain of 14.57% for VXUS.
Over three years, IAGG compounded at +3.08% per year against +19.27% for VXUS; over five years the annualized figures are -0.02% and +9.28% respectively. Across the full 11-year window we track, VXUS has the edge at +4.86% annualized vs +2.04%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VXUS has been the more volatile fund, with annualized monthly volatility of 15.1% compared with 4.1% for IAGG. 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 -13.9% for IAGG and -39.9% for VXUS. 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 0.39. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
IAGG charges 0.07% per year while VXUS charges 0.05%. On a $10,000 position that is $7 vs $5 annually, a gap of $2 per year that compounds over a long holding period. On income, IAGG currently yields 3.63% against 2.60% for VXUS.
Holdings Overlap
IAGG and VXUS share 0 holdings out of 8245 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, IAGG or VXUS?
IAGG has an expense ratio of 0.07% while VXUS charges 0.05%. VXUS is the cheaper option. On a $10,000 investment, that is $2 per year of difference.
Which performed better, IAGG or VXUS?
Over the past year IAGG returned -2.31% vs +27.82% for VXUS, so VXUS leads on 1-year performance. Over the longest common window we track (11 years), IAGG annualized +2.04% vs +4.86% for VXUS. Past performance does not guarantee future results.
Which is riskier, IAGG or VXUS?
VXUS has been the more volatile fund at 15.1% annualized versus 4.1% for IAGG. Worst drawdown: IAGG -13.9% vs VXUS -39.9%.
Should I hold both IAGG and VXUS?
IAGG and VXUS have a monthly-return correlation of 0.39, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IAGG and VXUS?
IAGG and VXUS share 0 common holdings with a 0.0% weight overlap. Combined, they hold 8245 unique securities.
Which pays a higher dividend, IAGG or VXUS?
IAGG yields 3.63% while VXUS yields 2.60%, so IAGG currently pays the higher dividend yield.
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