The Vanguard Total International Bond Index Fund ETF Shares (BNDX) and the Dimensional U.S. Core Equity 2 ETF (DFAC) are both among the Top 100 ETFs. BNDX is a Vanguard N/A fund and DFAC is a Dimensional Fund Advisors Large Blend fund. So, what’s the difference between BNDX and DFAC? And which fund is better?
The expense ratio of BNDX is 0.11 percentage points lower than DFAC’s (0.08% vs. 0.19%). BNDX is mostly comprised of A bonds while DFAC has a high exposure to the technology sector. Overall, BNDX has provided lower returns than DFAC over the past ten years.
In this article, we’ll compare BNDX vs. DFAC. We’ll look at holdings and risk metrics, as well as at their industry exposure and performance. Moreover, I’ll also discuss BNDX’s and DFAC’s portfolio growth, annual returns, and fund composition and examine how these affect their overall returns.
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Summary
| BNDX | DFAC | |
| Name | Vanguard Total International Bond Index Fund ETF Shares | Dimensional U.S. Core Equity 2 ETF |
| Category | N/A | Large Blend |
| Issuer | Vanguard | Dimensional Fund Advisors |
| AUM | 116.41B | 13.53B |
| Avg. Return | 4.63% | 13.93% |
| Div. Yield | 0.94% | 1.0% |
| Expense Ratio | 0.08% | 0.19% |
The Vanguard Total International Bond Index Fund ETF Shares (BNDX) is a N/A fund that is issued by Vanguard. It currently has 116.41B total assets under management and has yielded an average annual return of 4.63% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.08%.
The Dimensional U.S. Core Equity 2 ETF (DFAC) is a Large Blend fund that is issued by Dimensional Fund Advisors. It currently has 13.53B total assets under management and has yielded an average annual return of 13.93% over the past 10 years. The fund has a dividend yield of 1.0% with an expense ratio of 0.19%.
BNDX’s dividend yield is 0.06% lower than that of DFAC (0.94% vs. 1.0%). Also, BNDX yielded on average 9.30% less per year over the past decade (4.63% vs. 13.93%). The expense ratio of BNDX is 0.11 percentage points lower than DFAC’s (0.08% vs. 0.19%).
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Fund Composition
Holdings
| BNDX Bond Sectors | Weight |
| A | 29.19% |
| AA | 26.79% |
| AAA | 21.59% |
| BBB | 19.41% |
| Others | 1.57% |
| Below B | 1.45% |
| B | 0.0% |
| BB | 0.0% |
| US Government | 0.0% |
BNDX’s Top Bond Sectors are ratings of A, AA, AAA, BBB, and Others at 29.19%, 26.79%, 21.59%, 19.41%, and 1.57%. The fund is less weighted towards Below B (1.45%), B (0.0%), and BB (0.0%) rated bonds.
| DFAC Holdings | Weight |
| Apple Inc | 4.7% |
| Microsoft Corp | 3.81% |
| Amazon.com Inc | 2.39% |
| Johnson & Johnson | 1.05% |
| Facebook Inc Class A | 1.05% |
| JPMorgan Chase & Co | 1.0% |
| Alphabet Inc Class C | 0.85% |
| Alphabet Inc Class A | 0.84% |
| Berkshire Hathaway Inc Class B | 0.75% |
| Visa Inc Class A | 0.74% |
DFAC’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Johnson & Johnson, and Facebook Inc Class A at 4.7%, 3.81%, 2.39%, 1.05%, and 1.05%.
JPMorgan Chase & Co (1.0%), Alphabet Inc Class C (0.85%), and Alphabet Inc Class A (0.84%) have a slightly smaller but still significant weight. Berkshire Hathaway Inc Class B and Visa Inc Class A are also represented in the DFAC’s holdings at 0.75% and 0.74%.
Risk Analysis
| BNDX | DFAC | |
| Mean Return | 0 | 1.19 |
| R-squared | 0 | 95.1 |
| Std. Deviation | 0 | 15.55 |
| Alpha | 0 | -2.75 |
| Beta | 0 | 1.12 |
| Sharpe Ratio | 0 | 0.88 |
| Treynor Ratio | 0 | 11.85 |
The Vanguard Total International Bond Index Fund ETF Shares (BNDX) has a R-squared of 0 with a Mean Return of 0 and a Sharpe Ratio of 0. Its Treynor Ratio is 0 while BNDX’s Alpha is 0. Furthermore, the fund has a Standard Deviation of 0 and a Beta of 0.
The Dimensional U.S. Core Equity 2 ETF (DFAC) has a Beta of 1.12 with a Treynor Ratio of 11.85 and a Sharpe Ratio of 0.88. Its Mean Return is 1.19 while DFAC’s R-squared is 95.1. Furthermore, the fund has a Alpha of -2.75 and a Standard Deviation of 15.55.
BNDX’s Mean Return is 1.19 points lower than that of DFAC and its R-squared is 95.10 points lower. With a Standard Deviation of 0, BNDX is slightly less volatile than DFAC. The Alpha and Beta of BNDX are 2.75 points higher and 1.12 points lower than DFAC’s Alpha and Beta.
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Performance
Annual Returns
| Year | BNDX | DFAC |
| 2020 | 4.6% | 15.8% |
| 2019 | 7.88% | 29.54% |
| 2018 | 2.94% | -9.43% |
| 2017 | 2.4% | 18.82% |
| 2016 | 4.67% | 16.31% |
| 2015 | 1.08% | -2.53% |
| 2014 | 8.83% | 9.56% |
| 2013 | 0.0% | 37.55% |
| 2012 | 0.0% | 17.93% |
| 2011 | 0.0% | -1.96% |
| 2010 | 0.0% | 21.67% |
BNDX had its best year in 2014 with an annual return of 8.83%. BNDX’s worst year over the past decade yielded 0.0% and occurred in 2013. In most years the Vanguard Total International Bond Index Fund ETF Shares provided moderate returns such as in 2015, 2017, and 2018 where annual returns amounted to 1.08%, 2.4%, and 2.94% respectively.
The year 2013 was the strongest year for DFAC, returning 37.55% on an annual basis. The poorest year for DFAC in the last ten years was 2018, with a yield of -9.43%. Most years the Dimensional U.S. Core Equity 2 ETF has given investors modest returns, such as in 2020, 2016, and 2012, when gains were 15.8%, 16.31%, and 17.93% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| BNDX | $10,000 | $13,695 | 4.63% |
| DFAC | $10,000 | $20,050 | 13.93% |
A $10,000 investment in BNDX would have resulted in a final balance of $13,695. This is a profit of $3,695 over 7 years and amounts to a compound annual growth rate (CAGR) of 4.63%.
With a $10,000 investment in DFAC, the end total would have been $20,050. This equates to a $10,050 profit over 7 years and a compound annual growth rate (CAGR) of 13.93%.
BNDX’s CAGR is 9.30 percentage points lower than that of DFAC and as a result, would have yielded $6,355 less on a $10,000 investment. Thus, BNDX performed worse than DFAC by 9.30% annually.
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