AGG vs ILTB

AGGAiShares Core U.S. Aggregate Bond ETF

ILTBAiShares Core 10+ Year USD Bond ETF

In short

AGG Launched in 2003, one of the first funds to pack the entire U.S. investment-grade bond market into a single ticker: Treasuries, corporates and mortgage bonds, three basis points a year, cash paid monthly.

ILTB Take the whole U.S. bond market and keep only the long end. ILTB tracks a Bloomberg index of dollar bonds maturing in 10+ years, investment grade and high yield alike, for six basis points.

Stated mandate

AGG The fund seeks to track the Bloomberg U.S. Aggregate Bond Index, providing broad exposure to the total U.S. investment-grade bond market.

ILTB The fund seeks to track an index of U.S.-dollar-denominated investment-grade and high-yield bonds with remaining maturities above ten years.

Why people hold it

• AGG 0.03% a year against a peer-group median near 0.36%. On a bond fund, the fee comes straight out of the coupon, so the gap matters more than it looks.
• A $100 billion-plus fund and very actively traded, the kind of depth that keeps bid-ask costs down for retail-sized orders.
• Tracks the Bloomberg U.S. Aggregate closely, with one of the tightest index-following records in its peer group. Income is distributed monthly.
• Running since 2003, giving it one of the longest track records among U.S. bond index ETFs.

• ILTB Costs 0.06% a year, a fraction of the typical fund in its broad-bond peer group, where the median is 0.36%.
• One ticker for the long maturity slice of the U.S. bond market: Treasuries, corporates and high yield, all 10+ years, via the Bloomberg U.S. Universal 10+ Year Index.
• Pays monthly and has been running since 2009, through several full rate cycles.
• Broad holdings and low fees put it in the top quartile of its 187-fund bond cohort on our review.

Worth knowing

• AGG Investment grade and U.S. dollar only. High-yield debt and foreign bonds sit outside the mandate, so this is designed as core ballast rather than a yield hunt.
• Rate risk comes as it comes. The index gets tracked whether yields rise or fall, with no manager stepping in to shorten duration.
• The same index is sold by SPAB, SCHZ and BBAG at the same 0.03%. The portfolio is the commodity here; scale and trading depth are the tiebreakers.

• ILTB Long bonds only means outsized sensitivity to interest rates. Expect much bigger price swings than an aggregate fund like BND or SPAB.
• The index reaches past investment grade into high yield, so credit risk rides along with the duration.
• Moderately traded rather than a volume giant. Limit orders are the sane default.

Full AGG profile⁠

Full ILTB profile⁠