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VCSH vs. JPST: What’s The Difference?

The Vanguard Short-Term Corporate Bond Index Fund ETF Shares (VCSH) and the JPMorgan Ultra-Short Income ETF (JPST) are both among the Top 100 ETFs. VCSH is a Vanguard Short-Term Bond fund and JPST is a JPMorgan Ultrashort Bond fund. So, what’s the difference between VCSH and JPST? And which fund is better?

The expense ratio of VCSH is 0.13 percentage points lower than JPST’s (0.05% vs. 0.18%). VCSH is mostly comprised of BBB bonds and JPST has a high exposure to A bond. Overall, VCSH has provided higher returns than JPST over the past ten years.

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

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Summary

VCSHJPST
NameVanguard Short-Term Corporate Bond Index Fund ETF SharesJPMorgan Ultra-Short Income ETF
CategoryShort-Term BondUltrashort Bond
IssuerVanguardJPMorgan
AUM47.88B17.32B
Avg. Return3.12%2.57%
Div. Yield1.89%0.94%
Expense Ratio0.05%0.18%

The Vanguard Short-Term Corporate Bond Index Fund ETF Shares (VCSH) is a Short-Term Bond fund that is issued by Vanguard. It currently has 47.88B total assets under management and has yielded an average annual return of 3.12% over the past 10 years. The fund has a dividend yield of 1.89% with an expense ratio of 0.05%.

The JPMorgan Ultra-Short Income ETF (JPST) is a Ultrashort Bond fund that is issued by JPMorgan. It currently has 17.32B total assets under management and has yielded an average annual return of 2.57% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.18%.

VCSH’s dividend yield is 0.95% higher than that of JPST (1.89% vs. 0.94%). Also, VCSH yielded on average 0.54% more per year over the past decade (3.12% vs. 2.57%). The expense ratio of VCSH is 0.13 percentage points lower than JPST’s (0.05% vs. 0.18%).

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Fund Composition

Holdings

VCSH - Holdings

VCSH Bond SectorsWeight
BBB47.49%
A43.06%
AA8.45%
AAA0.95%
Below B0.03%
Others0.02%
B0.0%
BB0.0%
US Government0.0%

VCSH’s Top Bond Sectors are ratings of BBB, A, AA, AAA, and Below B at 47.49%, 43.06%, 8.45%, 0.95%, and 0.03%. The fund is less weighted towards Others (0.02%), B (0.0%), and BB (0.0%) rated bonds.

JPST - Holdings

JPST Bond SectorsWeight
A39.21%
BBB36.75%
AAA14.9%
AA9.14%
Others0.0%
Below B0.0%
B0.0%
BB0.0%
US Government0.0%

JPST’s Top Bond Sectors are ratings of A, BBB, AAA, AA, and Others at 39.21%, 36.75%, 14.9%, 9.14%, and 0.0%. The fund is less weighted towards Below B (0.0%), B (0.0%), and BB (0.0%) rated bonds.

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Risk Analysis

VCSHJPST
Mean Return0.240
R-squared37.530
Std. Deviation2.340
Alpha0.930
Beta0.480
Sharpe Ratio0.970
Treynor Ratio4.750

The Vanguard Short-Term Corporate Bond Index Fund ETF Shares (VCSH) has a Standard Deviation of 2.34 with a Alpha of 0.93 and a Mean Return of 0.24. Its Treynor Ratio is 4.75 while VCSH’s Sharpe Ratio is 0.97. Furthermore, the fund has a R-squared of 37.53 and a Beta of 0.48.

The JPMorgan Ultra-Short Income ETF (JPST) has a Standard Deviation of 0 with a Alpha of 0 and a Sharpe Ratio of 0. Its Beta is 0 while JPST’s Treynor Ratio is 0. Furthermore, the fund has a R-squared of 0 and a Mean Return of 0.

VCSH’s Mean Return is 0.24 points higher than that of JPST and its R-squared is 37.53 points higher. With a Standard Deviation of 2.34, VCSH is slightly more volatile than JPST. The Alpha and Beta of VCSH are 0.93 points higher and 0.48 points higher than JPST’s Alpha and Beta.

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Performance

Annual Returns

VCSH vs. JPST - Annual Returns

YearVCSHJPST
20205.08%2.17%
20196.85%3.36%
20180.91%2.19%
20172.45%0.0%
20162.63%0.0%
20151.25%0.0%
20141.96%0.0%
20131.37%0.0%
20125.74%0.0%
20112.94%0.0%
20105.51%0.0%

VCSH had its best year in 2019 with an annual return of 6.85%. VCSH’s worst year over the past decade yielded 0.91% and occurred in 2018. In most years the Vanguard Short-Term Corporate Bond Index Fund ETF Shares provided moderate returns such as in 2017, 2016, and 2011 where annual returns amounted to 2.45%, 2.63%, and 2.94% respectively.

The year 2019 was the strongest year for JPST, returning 3.36% on an annual basis. The poorest year for JPST in the last ten years was 2017, with a yield of 0.0%. Most years the JPMorgan Ultra-Short Income ETF has given investors modest returns, such as in 2013, 2012, and 2011, when gains were 0.0%, 0.0%, and 0.0% respectively.

Portfolio Growth

VCSH vs. JPST - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VCSH$10,000$11,3293.12%
JPST$10,000$10,7912.57%

A $10,000 investment in VCSH would have resulted in a final balance of $11,329. This is a profit of $1,329 over 3 years and amounts to a compound annual growth rate (CAGR) of 3.12%.

With a $10,000 investment in JPST, the end total would have been $10,791. This equates to a $791 profit over 3 years and a compound annual growth rate (CAGR) of 2.57%.

VCSH’s CAGR is 0.54 percentage points higher than that of JPST and as a result, would have yielded $538 more on a $10,000 investment. Thus, VCSH outperformed JPST by 0.54% annually.


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