VBR vs VTBNX
Vanguard Morningstar Small-Cap Value ETF vs Vanguard Total Bond Market II Index Fund Institutional Shares
Quick Verdict
VTBNX has a lower expense ratio. VBR delivered stronger 1-year returns. VTBNX offers more diversification with 15,623 holdings.
Side-by-Side Comparison
| Metric | VBR | VTBNX | Winner |
|---|---|---|---|
| Expense Ratio | 0.05% | 0.02% | |
| AUM | $37.3B | $207.3B | |
| Dividend Yield | 1.76% | 3.79% | |
| Holdings | 847 | 15,623 | |
| YTD Return | +17.41% | -2.49% | |
| 1Y Return | +25.34% | -1.68% | |
| 3Y Return (annualized) | +17.49% | +0.72% | |
| 5Y Return (annualized) | +10.14% | -3.58% | |
| Volatility (annualized) | 19.0% | 6.3% | |
| Max Drawdown | -64.0% | -21.5% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Fixed Income | |
| Inception | Jan 26, 2004 | Feb 17, 2009 |
VBR vs VTBNX Performance
Vanguard Morningstar Small-Cap Value ETF (VBR) is a 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 VBR returned +25.34% while VTBNX returned -1.68%. Year to date, VBR is up 17.41% versus a loss of 2.49% for VTBNX.
Over three years, VBR compounded at +17.49% per year against +0.72% for VTBNX; over five years the annualized figures are +10.14% and -3.58% respectively. Across the full 5-year window we track, VBR has the edge at +8.00% annualized vs -3.58%. 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 6.3% for VTBNX. 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 -21.5% for VTBNX. 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 0.57. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VBR charges 0.05% per year while VTBNX charges 0.02%. On a $10,000 position that is $5 vs $2 annually, a gap of $3 per year that compounds over a long holding period. On income, VBR currently yields 1.76% against 3.79% for VTBNX.
Holdings Overlap
VBR and VTBNX share 4 holdings out of 13559 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in VBR | Weight in VTBNX | Difference |
|---|---|---|---|
| NNN | 0.19% | 0.00% | 0.19% |
| ZBH 2.6 11/24/31 | 0.18% | 0.00% | 0.18% |
| HUBB | 0.15% | 0.00% | 0.15% |
| GMT | Pro | Pro | Pro |
Frequently Asked Questions
Which is cheaper, VBR or VTBNX?
VBR has an expense ratio of 0.05% while VTBNX charges 0.02%. VTBNX is the cheaper option. On a $10,000 investment, that is $3 per year of difference.
Which performed better, VBR or VTBNX?
Over the past year VBR returned +25.34% vs -1.68% for VTBNX, so VBR leads on 1-year performance. Over the longest common window we track (5 years), VBR annualized +8.00% vs -3.58% for VTBNX. Past performance does not guarantee future results.
Which is riskier, VBR or VTBNX?
VBR has been the more volatile fund at 19.0% annualized versus 6.3% for VTBNX. Worst drawdown: VBR -64.0% vs VTBNX -21.5%.
Should I hold both VBR and VTBNX?
VBR and VTBNX have a monthly-return correlation of 0.57, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VBR and VTBNX?
VBR and VTBNX share 4 common holdings with a 0.0% weight overlap. Combined, they hold 13559 unique securities.
Which pays a higher dividend, VBR or VTBNX?
VBR yields 1.76% while VTBNX yields 3.79%, so VTBNX currently pays the higher dividend yield.
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