VBR vs VCIT
Vanguard Small Cap Value ETF vs Vanguard Intermediate Term Corporate Bond ETF
Quick Verdict
VCIT has a lower expense ratio. VBR delivered stronger 1-year returns. VCIT offers more diversification with 2019 holdings.
Side-by-Side Comparison
| Metric | VBR | VCIT | Winner |
|---|---|---|---|
| Expense Ratio | 0.05% | 0.03% | |
| AUM | $36.9B | $67.3B | |
| Dividend Yield | 2.23% | 4.77% | |
| Holdings | 853 | 2,253 | |
| YTD Return | +17.75% | -0.43% | |
| 1Y Return | +28.74% | +2.34% | |
| 3Y Return (annualized) | +15.64% | +5.82% | |
| 5Y Return (annualized) | +10.13% | +0.84% | |
| Volatility (annualized) | 19.0% | 6.0% | |
| Max Drawdown | -64.0% | -20.7% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Jan 26, 2004 | Nov 19, 2009 |
VBR vs VCIT Performance
Vanguard Small Cap Value ETF (VBR) is a ETF from Vanguard (US) and Vanguard Intermediate Term Corporate Bond ETF (VCIT) is a ETF from Vanguard (US). Over the past year VBR returned +28.74% while VCIT returned +2.34%. Year to date, VBR is up 17.75% versus a loss of 0.43% for VCIT.
Over three years, VBR compounded at +15.64% per year against +5.82% for VCIT; over five years the annualized figures are +10.13% and +0.84% respectively. Across the full 17-year window we track, VBR has the edge at +8.03% annualized vs +1.75%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VBR has been the more volatile fund, with annualized monthly volatility of 19.0% compared with 6.0% for VCIT. 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 -64.0% for VBR and -20.7% for VCIT. 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 0.41. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VBR charges 0.05% per year while VCIT charges 0.03%. On a $10,000 position that is $5 vs $3 annually, a gap of $2 per year that compounds over a long holding period. On income, VBR currently yields 2.23% against 4.77% for VCIT.
Holdings Overlap
VBR and VCIT share 0 holdings out of 2828 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, VBR or VCIT?
VBR has an expense ratio of 0.05% while VCIT charges 0.03%. VCIT is the cheaper option. On a $10,000 investment, that is $2 per year of difference.
Which performed better, VBR or VCIT?
Over the past year VBR returned +28.74% vs +2.34% for VCIT, so VBR leads on 1-year performance. Over the longest common window we track (17 years), VBR annualized +8.03% vs +1.75% for VCIT. Past performance does not guarantee future results.
Which is riskier, VBR or VCIT?
VBR has been the more volatile fund at 19.0% annualized versus 6.0% for VCIT. Worst drawdown: VBR -64.0% vs VCIT -20.7%.
Should I hold both VBR and VCIT?
VBR and VCIT have a monthly-return correlation of 0.41, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VBR and VCIT?
VBR and VCIT share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2828 unique securities.
Which pays a higher dividend, VBR or VCIT?
VBR yields 2.23% while VCIT yields 4.77%, so VCIT currently pays the higher dividend yield.
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