The Vanguard Total International Bond Index Fund ETF Shares (BNDX) and the Vanguard FTSE Europe Index Fund ETF Shares (VGK) are both among the Top 100 ETFs. BNDX is a Vanguard N/A fund and VGK is a Vanguard Europe Stock fund. So, what’s the difference between BNDX and VGK? And which fund is better?
BNDX and VGK have the same expense ratio: 0.08%. BNDX is mostly comprised of A bonds while VGK has a high exposure to the financial services sector. Overall, BNDX has provided lower returns than VGK over the past ten years.
In this article, we’ll compare BNDX vs. VGK. We’ll look at industry exposure and risk metrics, as well as at their performance and holdings. Moreover, I’ll also discuss BNDX’s and VGK’s annual returns, portfolio growth, and fund composition and examine how these affect their overall returns.
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|Name||Vanguard Total International Bond Index Fund ETF Shares||Vanguard FTSE Europe Index Fund ETF Shares|
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 Vanguard FTSE Europe Index Fund ETF Shares (VGK) is a Europe Stock fund that is issued by Vanguard. It currently has 25.7B total assets under management and has yielded an average annual return of 6.68% over the past 10 years. The fund has a dividend yield of 2.52% with an expense ratio of 0.08%.
BNDX’s dividend yield is 1.58% lower than that of VGK (0.94% vs. 2.52%). Also, BNDX yielded on average 2.05% less per year over the past decade (4.63% vs. 6.68%). BNDX and VGK have the same expense ratio: 0.08%.
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|BNDX Bond Sectors||Weight|
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.
|ASML Holding NV||2.2%|
|Roche Holding AG||2.13%|
|LVMH Moet Hennessy Louis Vuitton SE||1.58%|
|Novo Nordisk A/S B||1.09%|
VGK’s Top Holdings are Nestle SA, ASML Holding NV, Roche Holding AG, LVMH Moet Hennessy Louis Vuitton SE, and Novartis AG at 2.82%, 2.2%, 2.13%, 1.58%, and 1.55%.
AstraZeneca PLC (1.27%), SAP SE (1.25%), and Unilever PLC (1.23%) have a slightly smaller but still significant weight. Novo Nordisk A/S B and Siemens AG are also represented in the VGK’s holdings at 1.09% and 0.96%.
The Vanguard Total International Bond Index Fund ETF Shares (BNDX) has a Standard Deviation of 0 with a R-squared of 0 and a Alpha of 0. Its Treynor Ratio is 0 while BNDX’s Mean Return is 0. Furthermore, the fund has a Sharpe Ratio of 0 and a Beta of 0.
The Vanguard FTSE Europe Index Fund ETF Shares (VGK) has a Treynor Ratio of 5.12 with a R-squared of 92.76 and a Standard Deviation of 16.65. Its Alpha is 0.45 while VGK’s Beta is 1.06. Furthermore, the fund has a Mean Return of 0.61 and a Sharpe Ratio of 0.4.
BNDX’s Mean Return is 0.61 points lower than that of VGK and its R-squared is 92.76 points lower. With a Standard Deviation of 0, BNDX is slightly less volatile than VGK. The Alpha and Beta of BNDX are 0.45 points lower and 1.06 points lower than VGK’s Alpha and Beta.
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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 2017 was the strongest year for VGK, returning 27.06% on an annual basis. The poorest year for VGK in the last ten years was 2018, with a yield of -14.79%. Most years the Vanguard FTSE Europe Index Fund ETF Shares has given investors modest returns, such as in 2016, 2010, and 2020, when gains were -0.59%, 5.01%, and 6.5% respectively.
|Fund||Initial Balance||Final Balance||CAGR|
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 VGK, the end total would have been $13,060. This equates to a $3,060 profit over 7 years and a compound annual growth rate (CAGR) of 6.68%.
BNDX’s CAGR is 2.05 percentage points lower than that of VGK and as a result, would have yielded $635 more on a $10,000 investment. Thus, BNDX performed worse than VGK by 2.05% annually.
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