iShares Core U.S. Aggregate Bond ETF and Vanguard Total Bond Market ETF have returned almost the same
Both charge 0.03% a year, and through Wednesday, September 30, 2026 their ten-year returns differed by 0.02 percentage points a year.
Key takeaways
The iShares Core U.S. Aggregate Bond ETF and the Vanguard Total Bond Market ETF charge the same fee and have returned almost the same. If you already hold one, switching has not been worth it.
BlackRock's fund, AGG, and Vanguard's fund, BND, each cost 0.03% a year. On $10,000, that is $3 a year.
The one difference in the index
AGG tracks the Bloomberg US Aggregate Bond Index, the standard measure of the US investment-grade bond market. BND tracks the Bloomberg U.S. Aggregate Float Adjusted Index. Both hold Treasuries, investment-grade company bonds and mortgage bonds.
The float-adjusted index counts less of what the Federal Reserve already owns. Bloomberg's fixed-income methodology, dated Thursday, January 8, 2026, says it adjusts for Fed holdings of mortgage pass-throughs, agency bonds and commercial mortgage bonds, in addition to Treasuries.
On Tuesday, September 26, 2023, Morningstar researcher Lan Anh Tran reported that the float-adjusted index beat the Bloomberg US Aggregate Bond Index by 0.04 percentage points a year from June 2009 through June 2023, with slightly higher volatility. When yields rose, she wrote, the float-adjusted index lagged, and the magnitude was small.
What owners actually received
Through Wednesday, September 30, 2026, the net-asset-value total return each issuer reports, the return of the bonds including income, was almost the same. Returns longer than a year are annualized.
The ten-year gap is 0.02 percentage points a year, in BND's favor. At those rates, $10,000 ends about $22 ahead in BND after ten years.
The issuers also compare each fund with its own index over the twelve months ended Tuesday, June 30, 2026, a different window from the one-year row above. AGG returned 3.80% against 3.79% for the Bloomberg US Aggregate Bond Index, and BND returned 3.70% against 3.71% for the float-adjusted index. Each fund finished within 0.01 percentage points of the index it tracks.
Which fund to own
This choice is for an investor in the United States.
Stay with the fund you already own. About $22 on $10,000 over ten years is not a reason to sell.
Selling one at a loss to buy the other can run into the wash-sale rule. The Securities and Exchange Commission's Investor.gov glossary says a wash sale is selling at a loss and buying a substantially identical security within 30 days before or after, and that Internal Revenue Service rules prohibit deducting that loss. These funds track versions of the same index, so ask a tax adviser whether the rule treats them as substantially identical.
If you are starting, buy the one your broker lets you trade without a commission. If both are free to trade, both issuers put the 30-day median bid-ask spread, the gap between the buying price and the selling price, at 0.01% as of Thursday, October 8.
For 2025, Vanguard classified 44.06% of BND income as US government obligations. BlackRock classified 40.58% of AGG income that way, 3.48 percentage points less. If you are choosing a fund, both are free to trade, and the account is taxable in a state that exempts that income, take BND.
If both are free to trade, either fund is the right one in a retirement account or in a taxable account in a state that taxes this income.
ETFs in this story
Frequently asked questions
How close were the two funds' ten-year returns?
Through Wednesday, September 30, 2026, their ten-year returns differed by 0.02 percentage points a year, in BND's favor.
What do both funds charge?
Each costs 0.03% a year, which is $3 on $10,000.
How do the indexes they track differ?
AGG tracks the Bloomberg US Aggregate Bond Index, while BND tracks the float-adjusted index that counts less of what the Federal Reserve already owns.
How closely did each fund track its own index?
Over the twelve months ended Tuesday, June 30, 2026, each fund finished within 0.01 percentage points of the index it tracks.
