The Vanguard Total International Bond Index Fund ETF Shares (BNDX) and the Vanguard Total World Stock Index Fund ETF Shares (VT) are both among the Top 100 ETFs. BNDX is a Vanguard N/A fund and VT is a Vanguard N/A fund. So, what’s the difference between BNDX and VT? And which fund is better?
BNDX and VT have the same expense ratio: 0.08%. BNDX is mostly comprised of A bonds while VT has a high exposure to the technology sector. Overall, BNDX has provided lower returns than VT over the past ten years.
In this article, we’ll compare BNDX vs. VT. We’ll look at annual returns and performance, as well as at their portfolio growth and risk metrics. Moreover, I’ll also discuss BNDX’s and VT’s industry exposure, holdings, 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 Total World Stock 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 Total World Stock Index Fund ETF Shares (VT) is a N/A fund that is issued by Vanguard. It currently has 30.44B total assets under management and has yielded an average annual return of 10.42% over the past 10 years. The fund has a dividend yield of 1.65% with an expense ratio of 0.08%.
BNDX’s dividend yield is 0.71% lower than that of VT (0.94% vs. 1.65%). Also, BNDX yielded on average 5.79% less per year over the past decade (4.63% vs. 10.42%). BNDX and VT 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.
|Facebook Inc Class A||1.1%|
|Alphabet Inc Class A||0.97%|
|Alphabet Inc Class C||0.95%|
|JPMorgan Chase & Co||0.62%|
|Tencent Holdings Ltd||0.6%|
VT’s Top Holdings are Apple Inc, Microsoft Corp, Amazon.com Inc, Facebook Inc Class A, and Alphabet Inc Class A at 2.85%, 2.71%, 1.98%, 1.1%, and 0.97%.
Alphabet Inc Class C (0.95%), Tesla Inc (0.7%), and NVIDIA Corp (0.64%) have a slightly smaller but still significant weight. JPMorgan Chase & Co and Tencent Holdings Ltd are also represented in the VT’s holdings at 0.62% and 0.6%.
The Vanguard Total International Bond Index Fund ETF Shares (BNDX) has a R-squared of 0 with a Alpha of 0 and a Beta of 0. Its Sharpe Ratio is 0 while BNDX’s Treynor Ratio is 0. Furthermore, the fund has a Mean Return of 0 and a Standard Deviation of 0.
The Vanguard Total World Stock Index Fund ETF Shares (VT) has a Standard Deviation of 14.19 with a Beta of 1.01 and a Treynor Ratio of 9.5. Its Sharpe Ratio is 0.71 while VT’s Alpha is 0.2. Furthermore, the fund has a R-squared of 99.35 and a Mean Return of 0.9.
BNDX’s Mean Return is 0.90 points lower than that of VT and its R-squared is 99.35 points lower. With a Standard Deviation of 0, BNDX is slightly less volatile than VT. The Alpha and Beta of BNDX are 0.20 points lower and 1.01 points lower than VT’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 2019 was the strongest year for VT, returning 26.8% on an annual basis. The poorest year for VT in the last ten years was 2018, with a yield of -9.67%. Most years the Vanguard Total World Stock Index Fund ETF Shares has given investors modest returns, such as in 2016, 2010, and 2020, when gains were 8.77%, 13.05%, and 16.74% 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 VT, the end total would have been $18,426. This equates to a $8,426 profit over 7 years and a compound annual growth rate (CAGR) of 10.42%.
BNDX’s CAGR is 5.79 percentage points lower than that of VT and as a result, would have yielded $4,731 less on a $10,000 investment. Thus, BNDX performed worse than VT by 5.79% annually.
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