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BNDX vs. IUSB: What’s The Difference?

The Vanguard Total International Bond Index Fund ETF Shares (BNDX) and the iShares Core Total USD Bond Market ETF (IUSB) are both among the Top 100 ETFs. BNDX is a Vanguard N/A fund and IUSB is a iShares N/A fund. So, what’s the difference between BNDX and IUSB? And which fund is better?

The expense ratio of BNDX is 0.02 percentage points higher than IUSB’s (0.08% vs. 0.06%). BNDX is mostly comprised of A bonds and IUSB has a high exposure to AAA bond. Overall, BNDX has provided higher returns than IUSB over the past ten years.

In this article, we’ll compare BNDX vs. IUSB. We’ll look at holdings and portfolio growth, as well as at their fund composition and performance. Moreover, I’ll also discuss BNDX’s and IUSB’s risk metrics, industry exposure, and annual returns and examine how these affect their overall returns.

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Summary

BNDXIUSB
NameVanguard Total International Bond Index Fund ETF SharesiShares Core Total USD Bond Market ETF
CategoryN/AN/A
IssuerVanguardiShares
AUM116.41B14.49B
Avg. Return4.63%4.13%
Div. Yield0.94%2.1%
Expense Ratio0.08%0.06%

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 iShares Core Total USD Bond Market ETF (IUSB) is a N/A fund that is issued by iShares. It currently has 14.49B total assets under management and has yielded an average annual return of 4.13% over the past 10 years. The fund has a dividend yield of 2.1% with an expense ratio of 0.06%.

BNDX’s dividend yield is 1.16% lower than that of IUSB (0.94% vs. 2.1%). Also, BNDX yielded on average 0.50% more per year over the past decade (4.63% vs. 4.13%). The expense ratio of BNDX is 0.02 percentage points higher than IUSB’s (0.08% vs. 0.06%).

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Fund Composition

Holdings

BNDX - Holdings

BNDX Bond SectorsWeight
A29.19%
AA26.79%
AAA21.59%
BBB19.41%
Others1.57%
Below B1.45%
B0.0%
BB0.0%
US Government0.0%

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.

IUSB - Holdings

IUSB Bond SectorsWeight
AAA58.32%
BBB16.98%
A12.27%
BB4.33%
AA3.36%
B2.8%
Others1.01%
Below B0.92%
US Government0.0%

IUSB’s Top Bond Sectors are ratings of AAA, BBB, A, BB, and AA at 58.32%, 16.98%, 12.27%, 4.33%, and 3.36%. The fund is less weighted towards B (2.8%), Others (1.01%), and Below B (0.92%) rated bonds.

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Risk Analysis

BNDXIUSB
Mean Return00
R-squared00
Std. Deviation00
Alpha00
Beta00
Sharpe Ratio00
Treynor Ratio00

The Vanguard Total International Bond Index Fund ETF Shares (BNDX) has a Sharpe Ratio of 0 with a R-squared of 0 and a Standard Deviation of 0. Its Mean Return is 0 while BNDX’s Alpha is 0. Furthermore, the fund has a Treynor Ratio of 0 and a Beta of 0.

The iShares Core Total USD Bond Market ETF (IUSB) has a Mean Return of 0 with a Treynor Ratio of 0 and a Sharpe Ratio of 0. Its Beta is 0 while IUSB’s Alpha is 0. Furthermore, the fund has a Standard Deviation of 0 and a R-squared of 0.

BNDX’s Mean Return is 0.00 points lower than that of IUSB and its R-squared is 0.00 points lower. With a Standard Deviation of 0, BNDX is slightly less volatile than IUSB. The Alpha and Beta of BNDX are 0.00 points lower and 0.00 points lower than IUSB’s Alpha and Beta.

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Performance

Annual Returns

BNDX vs. IUSB - Annual Returns

YearBNDXIUSB
20204.6%7.59%
20197.88%9.26%
20182.94%-0.38%
20172.4%4.06%
20164.67%3.78%
20151.08%0.46%
20148.83%0.0%
20130.0%0.0%
20120.0%0.0%
20110.0%0.0%
20100.0%0.0%

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 2019 was the strongest year for IUSB, returning 9.26% on an annual basis. The poorest year for IUSB in the last ten years was 2018, with a yield of -0.38%. Most years the iShares Core Total USD Bond Market ETF has given investors modest returns, such as in 2011, 2010, and 2015, when gains were 0.0%, 0.0%, and 0.46% respectively.

Portfolio Growth

BNDX vs. IUSB - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
BNDX$10,000$12,5844.63%
IUSB$10,000$12,7044.13%

A $10,000 investment in BNDX would have resulted in a final balance of $12,584. This is a profit of $2,584 over 6 years and amounts to a compound annual growth rate (CAGR) of 4.63%.

With a $10,000 investment in IUSB, the end total would have been $12,704. This equates to a $2,704 profit over 6 years and a compound annual growth rate (CAGR) of 4.13%.

BNDX’s CAGR is 0.50 percentage points higher than that of IUSB and as a result, would have yielded $120 less on a $10,000 investment. Thus, BNDX outperformed IUSB by 0.50% annually.


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