The Vanguard Short-Term Bond Index Fund ETF Shares (BSV) and the Invesco S&P 500 Equal Weight ETF (RSP) are both among the Top 100 ETFs. BSV is a Vanguard Short-Term Bond fund and RSP is a Invesco Large Blend fund. So, what’s the difference between BSV and RSP? And which fund is better?
The expense ratio of BSV is 0.15 percentage points lower than RSP’s (0.05% vs. 0.2%). BSV is mostly comprised of AAA bonds while RSP has a high exposure to the technology sector. Overall, BSV has provided lower returns than RSP over the past ten years.
In this article, we’ll compare BSV vs. RSP. We’ll look at portfolio growth and risk metrics, as well as at their holdings and performance. Moreover, I’ll also discuss BSV’s and RSP’s annual returns, industry exposure, and fund composition and examine how these affect their overall returns.
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Summary
| BSV | RSP | |
| Name | Vanguard Short-Term Bond Index Fund ETF Shares | Invesco S&P 500 Equal Weight ETF |
| Category | Short-Term Bond | Large Blend |
| Issuer | Vanguard | Invesco |
| AUM | 67.71B | 28.62B |
| Avg. Return | 2.27% | 13.79% |
| Div. Yield | 1.48% | 1.31% |
| Expense Ratio | 0.05% | 0.2% |
The Vanguard Short-Term Bond Index Fund ETF Shares (BSV) is a Short-Term Bond fund that is issued by Vanguard. It currently has 67.71B total assets under management and has yielded an average annual return of 2.27% over the past 10 years. The fund has a dividend yield of 1.48% with an expense ratio of 0.05%.
The Invesco S&P 500 Equal Weight ETF (RSP) is a Large Blend fund that is issued by Invesco. It currently has 28.62B total assets under management and has yielded an average annual return of 13.79% over the past 10 years. The fund has a dividend yield of 1.31% with an expense ratio of 0.2%.
BSV’s dividend yield is 0.17% higher than that of RSP (1.48% vs. 1.31%). Also, BSV yielded on average 11.52% less per year over the past decade (2.27% vs. 13.79%). The expense ratio of BSV is 0.15 percentage points lower than RSP’s (0.05% vs. 0.2%).
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Fund Composition
Holdings
| BSV Bond Sectors | Weight |
| AAA | 71.65% |
| BBB | 13.08% |
| A | 11.95% |
| AA | 3.28% |
| Others | 0.03% |
| Below B | 0.01% |
| B | 0.0% |
| BB | 0.0% |
| US Government | 0.0% |
BSV’s Top Bond Sectors are ratings of AAA, BBB, A, AA, and Others at 71.65%, 13.08%, 11.95%, 3.28%, and 0.03%. The fund is less weighted towards Below B (0.01%), B (0.0%), and BB (0.0%) rated bonds.
| RSP Holdings | Weight |
| Chipotle Mexican Grill Inc | 0.27% |
| Nike Inc Class B | 0.25% |
| MSCI Inc | 0.25% |
| Monolithic Power Systems Inc | 0.25% |
| Enphase Energy Inc | 0.25% |
| Advanced Micro Devices Inc | 0.25% |
| ResMed Inc | 0.24% |
| PerkinElmer Inc | 0.24% |
| IDEXX Laboratories Inc | 0.24% |
| Danaher Corp | 0.24% |
RSP’s Top Holdings are Chipotle Mexican Grill Inc, Nike Inc Class B, MSCI Inc, Monolithic Power Systems Inc, and Enphase Energy Inc at 0.27%, 0.25%, 0.25%, 0.25%, and 0.25%.
Advanced Micro Devices Inc (0.25%), ResMed Inc (0.24%), and PerkinElmer Inc (0.24%) have a slightly smaller but still significant weight. IDEXX Laboratories Inc and Danaher Corp are also represented in the RSP’s holdings at 0.24% and 0.24%.
Risk Analysis
| BSV | RSP | |
| Mean Return | 0.16 | 1.19 |
| R-squared | 78.38 | 94.47 |
| Std. Deviation | 1.33 | 15.36 |
| Alpha | 0.21 | -2.45 |
| Beta | 0.38 | 1.1 |
| Sharpe Ratio | 0.98 | 0.89 |
| Treynor Ratio | 3.33 | 12.12 |
The Vanguard Short-Term Bond Index Fund ETF Shares (BSV) has a Treynor Ratio of 3.33 with a Mean Return of 0.16 and a Beta of 0.38. Its Sharpe Ratio is 0.98 while BSV’s R-squared is 78.38. Furthermore, the fund has a Standard Deviation of 1.33 and a Alpha of 0.21.
The Invesco S&P 500 Equal Weight ETF (RSP) has a Sharpe Ratio of 0.89 with a Standard Deviation of 15.36 and a Beta of 1.1. Its R-squared is 94.47 while RSP’s Alpha is -2.45. Furthermore, the fund has a Mean Return of 1.19 and a Treynor Ratio of 12.12.
BSV’s Mean Return is 1.03 points lower than that of RSP and its R-squared is 16.09 points lower. With a Standard Deviation of 1.33, BSV is slightly less volatile than RSP. The Alpha and Beta of BSV are 2.66 points higher and 0.72 points lower than RSP’s Alpha and Beta.
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Performance
Annual Returns
| Year | BSV | RSP |
| 2020 | 4.67% | 12.75% |
| 2019 | 4.92% | 28.94% |
| 2018 | 1.34% | -7.77% |
| 2017 | 1.2% | 18.52% |
| 2016 | 1.42% | 14.34% |
| 2015 | 0.92% | -2.57% |
| 2014 | 1.32% | 14.02% |
| 2013 | 0.17% | 35.6% |
| 2012 | 1.98% | 17.04% |
| 2011 | 3.04% | -0.5% |
| 2010 | 4.0% | 21.3% |
BSV had its best year in 2019 with an annual return of 4.92%. BSV’s worst year over the past decade yielded 0.17% and occurred in 2013. In most years the Vanguard Short-Term Bond Index Fund ETF Shares provided moderate returns such as in 2018, 2016, and 2012 where annual returns amounted to 1.34%, 1.42%, and 1.98% respectively.
The year 2013 was the strongest year for RSP, returning 35.6% on an annual basis. The poorest year for RSP in the last ten years was 2018, with a yield of -7.77%. Most years the Invesco S&P 500 Equal Weight ETF has given investors modest returns, such as in 2014, 2016, and 2012, when gains were 14.02%, 14.34%, and 17.04% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| BSV | $10,000 | $12,785 | 2.27% |
| RSP | $10,000 | $38,664 | 13.79% |
A $10,000 investment in BSV would have resulted in a final balance of $12,785. This is a profit of $2,785 over 11 years and amounts to a compound annual growth rate (CAGR) of 2.27%.
With a $10,000 investment in RSP, the end total would have been $38,664. This equates to a $28,664 profit over 11 years and a compound annual growth rate (CAGR) of 13.79%.
BSV’s CAGR is 11.52 percentage points lower than that of RSP and as a result, would have yielded $25,879 less on a $10,000 investment. Thus, BSV performed worse than RSP by 11.52% annually.
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