VCIT vs VGK
Vanguard Intermediate Term Corporate Bond ETF vs Vanguard FTSE Europe ETF
Quick Verdict
VCIT has a lower expense ratio. VGK delivered stronger 1-year returns. VCIT offers more diversification with 2019 holdings.
Side-by-Side Comparison
| Metric | VCIT | VGK | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.06% | |
| AUM | $67.3B | $30.0B | |
| Dividend Yield | 4.77% | 2.94% | |
| Holdings | 2,253 | 1,251 | |
| YTD Return | -0.86% | +11.11% | |
| 1Y Return | +2.08% | +23.13% | |
| 3Y Return (annualized) | +5.97% | +18.04% | |
| 5Y Return (annualized) | +0.79% | +9.43% | |
| Volatility (annualized) | 6.0% | 18.5% | |
| Max Drawdown | -20.7% | -67.3% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Nov 19, 2009 | Mar 4, 2005 |
VCIT vs VGK Performance
Vanguard Intermediate Term Corporate Bond ETF (VCIT) is a ETF from Vanguard (US) and Vanguard FTSE Europe ETF (VGK) is a ETF from Vanguard (US). Over the past year VCIT returned +2.08% while VGK returned +23.13%. Year to date, VCIT is down 0.86% versus a gain of 11.11% for VGK.
Over three years, VCIT compounded at +5.97% per year against +18.04% for VGK; over five years the annualized figures are +0.79% and +9.43% respectively. Across the full 17-year window we track, VGK has the edge at +3.69% annualized vs +1.72%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VGK has been the more volatile fund, with annualized monthly volatility of 18.5% 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 -20.7% for VCIT and -67.3% for VGK. 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 0.50. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VCIT charges 0.03% per year while VGK charges 0.06%. On a $10,000 position that is $3 vs $6 annually, a gap of $3 per year that compounds over a long holding period. On income, VCIT currently yields 4.77% against 2.94% for VGK.
Holdings Overlap
VCIT and VGK share 0 holdings out of 2977 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, VCIT or VGK?
VCIT has an expense ratio of 0.03% while VGK charges 0.06%. VCIT is the cheaper option. On a $10,000 investment, that is $3 per year of difference.
Which performed better, VCIT or VGK?
Over the past year VCIT returned +2.08% vs +23.13% for VGK, so VGK leads on 1-year performance. Over the longest common window we track (17 years), VCIT annualized +1.72% vs +3.69% for VGK. Past performance does not guarantee future results.
Which is riskier, VCIT or VGK?
VGK has been the more volatile fund at 18.5% annualized versus 6.0% for VCIT. Worst drawdown: VCIT -20.7% vs VGK -67.3%.
Should I hold both VCIT and VGK?
VCIT and VGK have a monthly-return correlation of 0.50, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VCIT and VGK?
VCIT and VGK share 0 common holdings with a 0.0% weight overlap. Combined, they hold 2977 unique securities.
Which pays a higher dividend, VCIT or VGK?
VCIT yields 4.77% while VGK yields 2.94%, so VCIT currently pays the higher dividend yield.
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