BND vs VGIT: which Vanguard bond ETF should you buy?

Vanguard’s Vanguard Total Bond Market ETF (BND) and Vanguard Intermediate-Term Treasury ETF (VGIT) both carry an ultra-low 0.03% expense ratio, but they differ meaningfully in size, portfolio composition, and risk characteristics. BND is substantially larger by assets under management and holds a broader mix of investment-grade bonds, while VGIT focuses exclusively on intermediate-term U.S. Treasuries.

Cost and size: both cheap, BND much larger

Both ETFs charge the same expense ratio, but BND’s scale and market coverage stand out. As of 2026-04-09, the funds show the following snapshot:

• Expense ratio: VGIT 0.03% | BND 0.03%
• 1-year return: VGIT 4.6% | BND 5.5%
• Dividend yield: VGIT 3.8% | BND 3.9%
• Beta: VGIT 0.80 | BND 0.98
• AUM: VGIT $48.47 billion | BND $387.46 billion

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-year return represents total return over the trailing 12 months.

Performance and risk: BND higher returns, deeper drawdown

Over the past five years, BND and VGIT have shown different downside behavior. The comparison below highlights the trade-off between return and drawdown:

• Max drawdown (5 years): VGIT (15.03%) | BND (17.93%)
• Growth of $1,000 over 5 years: VGIT $1,018 | BND $1,016

In the most recent year, BND delivered a slightly higher 1-year return and yield, but it also experienced a deeper five-year drawdown than VGIT.

What’s inside: broad bond exposure vs. Treasuries only

BND: diversified investment-grade bond exposure

The Vanguard Total Bond Market ETF provides exposure to the full U.S. investment-grade bond universe, holding 346 different securities as of its 19th year. Its largest positions include U.S. Dollar cash and a mix of U.S. Treasury notes, while it also invests in mortgage-backed and corporate bonds. This structure is designed to diversify both credit and interest rate risk. The fund’s “cash & others” sector exposure reflects its broad, market-weighted approach, and its top holdings are relatively small relative to the overall portfolio.

VGIT: intermediate-term U.S. Treasuries

In contrast, VGIT is anchored exclusively in U.S. Treasury bonds, with 76 holdings focused on intermediate maturities. Its top holdings are recent Treasury note issues, and its “cash & others” exposure reflects the fund’s government-only portfolio. Because VGIT does not include corporate or mortgage-backed debt, its credit risk is described as minimal compared with BND’s broader exposure.

Implications for investors: match the ETF to the goal

Although both ETFs are low-cost, they serve different portfolio purposes.

• VGIT concentrates on U.S. Treasuries, offering stability and a lower max drawdown than BND. It is positioned as a defensive option if an investor expects stock market weakness, since U.S. Treasury bonds tend to rise or hold value during equity volatility.
• BND is designed for a “set it and forget it” approach as a core bond holding. Its larger $387.46 billion asset base and broader investment-grade mix support diversification and are associated with a higher one-year return and slightly higher yield than VGIT.