VCSH vs VDIGX
Vanguard Short Term Corporate Bond ETF vs Vanguard Dividend Growth Fund Investor Class
Which is better, VCSH or VDIGX?
Short Term Bond against Large Cap Blend.
VCSH has a lower expense ratio.
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 | VCSH | VDIGX |
|---|---|---|
| Expense Ratio | 0.03%Best | 0.20% |
| AUM | $45.0B | $35.5B |
| Dividend Yield | 4.46% | 23.36% |
| Holdings | 3,023 | 62 |
| YTD Price Return | -1.94% | -2.04% |
| 1Y Price Return | -1.77% | -12.55% |
| 3Y Price Return (annualized) | +1.26% | -3.25% |
| 5Y Price Return (annualized) | -1.09% | -3.42% |
| Volatility (annualized) | 3.3%Best | 15.9% |
| Max Drawdown | -11.3%Best | -32.6% |
| Fund Family | Vanguard (US) | Vanguard (US) |
| Category | Fixed Income | Equity |
| Style | Short Term Bond | Large Cap Blend |
| Inception | Nov 19, 2009 | May 15, 1992 |
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. VCSH currently yields 4.46% and VDIGX 23.36%.
Volatility and max drawdown are measured over the window both funds cover: Sep 7, 2021 to Sep 2, 2026 (5 years).
VCSH vs VDIGX Performance
Vanguard Short Term Corporate Bond ETF (VCSH) is an ETF from Vanguard (US) and Vanguard Dividend Growth Fund Investor Class (VDIGX) is a mutual fund from Vanguard (US). Over the past year VCSH's price moved -1.77% and VDIGX's -12.55%, before the income each one paid out.
Over three years, VCSH compounded at +1.26% per year against -3.25% for VDIGX; over five years the annualized figures are -1.09% and -3.42% respectively.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VDIGX has been the more volatile fund, with annualized monthly volatility of 15.9% compared with 3.3% for VCSH. 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 -11.3% for VCSH and -32.6% for VDIGX. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.55. They move together some of the time, and apart the rest.
Fees and Cost Over Time
VCSH charges 0.03% per year while VDIGX charges 0.20%. On a $10,000 position that is $3 vs $20 annually, a gap of $17 per year that compounds over a long holding period. On income, VCSH currently yields 4.46% against 23.36% for VDIGX.
Structure and taxes
VDIGX is a mutual fund and VCSH 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 557 holdings in VCSH and 51 in VDIGX, totalling 20.6% and 99.3% of the two funds. The two books name no position in common, so there is no overlap percentage to show.
0 positions in common, counted across the 557 positions we hold weights for in VCSH and 51 in VDIGX, against full books of 3,023 and 62.
You are not choosing between two funds in isolation.
Whichever of VCSH and VDIGX 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, VCSH or VDIGX?
VCSH has an expense ratio of 0.03% while VDIGX charges 0.20%. VCSH is the cheaper option, by $17 a year on a $10,000 investment.
Which is riskier, VCSH or VDIGX?
VDIGX has been the more volatile fund at 15.9% annualized versus 3.3% for VCSH. Worst drawdown: VCSH -11.3% vs VDIGX -32.6%.
Should I hold both VCSH and VDIGX?
VCSH and VDIGX have a monthly-return correlation of 0.55, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, VCSH or VDIGX?
VCSH yields 4.46% while VDIGX yields 23.36%, so VDIGX currently pays the higher dividend yield.
Is it better to hold VDIGX or VCSH in a taxable account?
VCSH is an ETF and VDIGX 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 VDIGX better than VCSH?
VCSH has a lower expense ratio. Which one suits a particular account depends on what it is for. This is information, not a recommendation.