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VTV vs. BNDX: What’s The Difference?

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

The expense ratio of VTV is 0.04 percentage points lower than BNDX’s (0.04% vs. 0.08%). VTV also has a high exposure to the financial services sector while BNDX is mostly comprised of A bonds. Overall, VTV has provided higher returns than BNDX over the past ten years.

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

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Summary

VTVBNDX
NameVanguard Value Index Fund ETF SharesVanguard Total International Bond Index Fund ETF Shares
CategoryLarge ValueN/A
IssuerVanguardVanguard
AUM125.77B116.41B
Avg. Return12.07%4.63%
Div. Yield2.15%0.94%
Expense Ratio0.04%0.08%

The Vanguard Value Index Fund ETF Shares (VTV) is a Large Value fund that is issued by Vanguard. It currently has 125.77B total assets under management and has yielded an average annual return of 12.07% over the past 10 years. The fund has a dividend yield of 2.15% with an expense ratio of 0.04%.

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%.

VTV’s dividend yield is 1.21% higher than that of BNDX (2.15% vs. 0.94%). Also, VTV yielded on average 7.45% more per year over the past decade (12.07% vs. 4.63%). The expense ratio of VTV is 0.04 percentage points lower than BNDX’s (0.04% vs. 0.08%).

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Fund Composition

Holdings

VTV - Holdings

VTV HoldingsWeight
Berkshire Hathaway Inc Class B2.98%
JPMorgan Chase & Co2.82%
Johnson & Johnson2.6%
UnitedHealth Group Inc2.27%
Procter & Gamble Co1.98%
Bank of America Corp1.91%
Exxon Mobil Corp1.6%
Comcast Corp Class A1.57%
Intel Corp1.36%
Verizon Communications Inc1.32%

VTV’s Top Holdings are Berkshire Hathaway Inc Class B, JPMorgan Chase & Co, Johnson & Johnson, UnitedHealth Group Inc, and Procter & Gamble Co at 2.98%, 2.82%, 2.6%, 2.27%, and 1.98%.

Bank of America Corp (1.91%), Exxon Mobil Corp (1.6%), and Comcast Corp Class A (1.57%) have a slightly smaller but still significant weight. Intel Corp and Verizon Communications Inc are also represented in the VTV’s holdings at 1.36% and 1.32%.

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.

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Risk Analysis

VTVBNDX
Mean Return1.050
R-squared92.610
Std. Deviation13.780
Alpha-1.920
Beta0.980
Sharpe Ratio0.870
Treynor Ratio11.940

The Vanguard Value Index Fund ETF Shares (VTV) has a Alpha of -1.92 with a Beta of 0.98 and a Standard Deviation of 13.78. Its R-squared is 92.61 while VTV’s Treynor Ratio is 11.94. Furthermore, the fund has a Sharpe Ratio of 0.87 and a Mean Return of 1.05.

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

VTV’s Mean Return is 1.05 points higher than that of BNDX and its R-squared is 92.61 points higher. With a Standard Deviation of 13.78, VTV is slightly more volatile than BNDX. The Alpha and Beta of VTV are 1.92 points lower and 0.98 points higher than BNDX’s Alpha and Beta.

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Performance

Annual Returns

VTV vs. BNDX - Annual Returns

YearVTVBNDX
20202.23%4.6%
201925.85%7.88%
2018-5.39%2.94%
201717.12%2.4%
201616.88%4.67%
2015-0.89%1.08%
201413.19%8.83%
201333.03%0.0%
201215.19%0.0%
20111.16%0.0%
201014.45%0.0%

VTV had its best year in 2013 with an annual return of 33.03%. VTV’s worst year over the past decade yielded -5.39% and occurred in 2018. In most years the Vanguard Value Index Fund ETF Shares provided moderate returns such as in 2014, 2010, and 2012 where annual returns amounted to 13.19%, 14.45%, and 15.19% respectively.

The year 2014 was the strongest year for BNDX, returning 8.83% on an annual basis. The poorest year for BNDX in the last ten years was 2013, with a yield of 0.0%. Most years the Vanguard Total International Bond Index Fund ETF Shares has given investors modest returns, such as in 2015, 2017, and 2018, when gains were 1.08%, 2.4%, and 2.94% respectively.

Portfolio Growth

VTV vs. BNDX - Portfolio Growth

FundInitial BalanceFinal BalanceCAGR
VTV$10,000$18,69212.07%
BNDX$10,000$13,6954.63%

A $10,000 investment in VTV would have resulted in a final balance of $18,692. This is a profit of $8,692 over 7 years and amounts to a compound annual growth rate (CAGR) of 12.07%.

With a $10,000 investment in BNDX, the end total would have been $13,695. This equates to a $3,695 profit over 7 years and a compound annual growth rate (CAGR) of 4.63%.

VTV’s CAGR is 7.45 percentage points higher than that of BNDX and as a result, would have yielded $4,997 more on a $10,000 investment. Thus, VTV outperformed BNDX by 7.45% annually.


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