IAGG vs SPAB

IAGGAiShares Core International Aggregate Bond ETF

SPABAState Street SPDR Portfolio Aggregate Bond ETF

In short

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.

SPAB A 2007-vintage core bond fund priced at 0.03%: roughly 8,500 US investment-grade bonds in one ticket, at the same rock-bottom fee the household names charge for the same index.

Stated mandate

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.

SPAB The fund seeks to track the price and yield performance of the Bloomberg U.S. Aggregate Bond Index before fees and expenses, providing broad exposure to U.S.-dollar-denominated investment-grade bonds.

Why people hold it

• 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.

• SPAB 0.03% a year against a 0.36% median for its peer group, and the same ticket price as AGG, SCHZ and BBAG on the identical index.
• Roughly 8,500 dollar-denominated investment-grade bonds in one line item, tracking the Bloomberg U.S. Aggregate Bond Index. Diversification you could not assemble bond by bond.ssga.com
• Trades actively and has tracked its index closely, putting it among the stronger implementations in the core-bond group.
• Running since 2007, now a multi-billion-dollar fund, and it pays monthly rather than quarterly.

Worth knowing

• 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.

• SPAB Bond prices move opposite yields. When rates rise the index falls and the fund follows it down; a 0.03% fee cannot cushion that.
• AGG, SCHZ and BBAG hold the same declared index at the same 0.03%. Picking among them comes down to spreads and platform, not the portfolio.
• Investment grade and US dollar only by mandate: high yield and foreign-currency debt sit outside the remit.ssga.com

Full IAGG profile⁠

Full SPAB profile⁠