AGG vs VCRB

AGGAiShares Core U.S. Aggregate Bond ETF

VCRBAVanguard Core 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.

VCRB Vanguard's active answer to its own index bond giant: VCRB roams the US investment-grade market looking to beat the Bloomberg US Aggregate Float Adjusted Index, and charges 0.10% to try.

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.

VCRB The fund seeks to outperform the broad U.S. investment-grade fixed-income market, measured by the Bloomberg US Aggregate Float Adjusted Index, by investing across fixed-income securities with different maturities, yields, and qualities.

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.

• VCRB Active management at near-index pricing: 0.10% a year, against a typical core-bond fee closer to 0.36%.
• Clear scorecard. It is measured against the same Bloomberg US Aggregate Float Adjusted Index that Vanguard's index fund BND simply tracks, so the active bet is easy to judge.
• Wide net: roughly 1,600 bonds across different maturities, yields and credit qualities, with income paid monthly.
• Already a multi-billion-dollar, actively traded fund, which is rare for a young active bond ETF.

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.

• VCRB Active means human calls. Returns can drift from the benchmark in either direction, unlike the index route BND takes at 0.03%.
• US investment-grade only. No international sleeve, no high-yield kicker, and like any core bond fund it moves with interest rates.
• Launched December 2023, so its live record is short next to core bond funds with decades behind them.

Full AGG profile⁠

Full VCRB profile⁠