BKAG vs IAGG

BKAGABNY Mellon Core Bond ETF

IAGGAiShares Core International Aggregate Bond ETF

In short

BKAG A core bond index fund that charges nothing. BKAG tracks the same Bloomberg US Aggregate benchmark the giants track, at a 0.00% expense ratio, and has been doing it since 2020.

IAGG The other half of the bond market, in dollars. IAGG holds investment-grade debt issued outside the US, developed and emerging, and hedges the currency swings back to USD for seven basis points.

Stated mandate

BKAG The fund seeks to track the Bloomberg US Aggregate Total Return Index.

IAGG The fund seeks to track an index representing global investment-grade bonds outside the United States, with exposure across developed and emerging markets and currency hedging to the U.S. dollar.

Why people hold it

• BKAG A 0.00% expense ratio. The median fund in the core bond group charges 0.36%, and even the cheap giants (BND, SPAB, SCHZ) charge 0.03%.
• Tracks the Bloomberg US Aggregate Total Return Index tightly, one of the closest index-following records in its peer group.
• Broad by design: roughly 4,000 bonds in the portfolio, with distributions paid monthly rather than quarterly.
• A multi-billion-dollar fund from BNY Mellon, wrapped in a standard 1940 Act ETF structure with no exotic mechanics.

• IAGG 0.07% a year for a global bond book. The median fund in its aggregate-bond peer group charges around 0.36%, and it is priced level with rival BNDX.
• Currency exposure is hedged to the dollar, so results track the bonds themselves rather than moves in the yen, euro or pound.ishares.com
• Roughly 7,900 bonds spanning developed and emerging markets outside the US, with a 10% issuer cap in the index keeping any one borrower in check.
• Running since 2015 inside the iShares Core lineup, a multi-billion-dollar fund that trades actively and pays quarterly.

Worth knowing

• BKAG Rate risk is the trade-off. This is full-market bond exposure, and bond prices move opposite interest rates. Volatility is the weakest part of its profile.
• Moderately traded, not one of the volume monsters in the category. Spreads and limit orders matter more here than with the largest core bond names.
• At zero, the fee edge over 0.03% rivals is real but small in dollar terms, so tracking and trading costs do more of the work.

• IAGG The hedge works both ways. It strips out currency losses and currency gains alike, so a sliding dollar adds nothing here.
• No US bonds at all. It is built as the ex-US complement to a domestic core holding such as BND or IUSB, not a standalone bond sleeve.
• Hedging covers currency, not duration. These are investment-grade bonds, and their prices still move as global interest rates move.

Full BKAG profile⁠

Full IAGG profile⁠