Vanguard Intermediate-Term Corporate Bond ETF (NASDAQ:VCIT) and Vanguard Total Bond Market ETF (NASDAQ:BND) share the same rock-bottom expense ratio, but VCIT offers a higher yield and greater recent returns, while BND stands out for its size, breadth, and lower volatility profile.
Both VCIT and BND target income-focused investors, but they take different approaches: VCIT focuses on investment-grade corporate bonds in the intermediate-maturity range, while BND casts a much wider net across the entire U.S. taxable bond market. This comparison highlights how those differences play out in cost, performance, risk, and portfolio makeup.
Snapshot (cost & size)
| Metric | VCIT | BND |
|---|---|---|
| Issuer | Vanguard | Vanguard |
| Expense ratio | 0.03% | 0.03% |
| 1-yr return (as of 2026-01-30) | 3.7% | 2.5% |
| Dividend yield | 4.6% | 3.9% |
| AUM | $61.8 billion | $384.8 billion |
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year weekly returns. The 1-yr return represents total return over the trailing 12 months.
Both funds are equally affordable, with expense ratios of just 0.03%, but VCIT delivers a higher payout, offering a 4.6% yield compared to BND’s 3.9%—a notable difference for income-seekers.
Performance & risk comparison
| Metric | VCIT | BND |
|---|---|---|
| Max drawdown (5 y) | (20.56%) | (17.93%) |
| Growth of $1,000 over 5 years | $872 | $850 |
What's inside
Vanguard Total Bond Market ETF provides exposure to the full spectrum of U.S. investment-grade bonds, with a portfolio of some 11,444 bonds as of Feb. 2026 and nearly two decades of history. Its top positions include Vanguard Market Liquidity Fund (Mktliq) 12/31/2049, United States Treasury Note/Bond 4.00% 02/15/2034, and United States Treasury Note/Bond 4.25% 11/15/2034, each representing less than 1.2% of assets. The fund’s broad diversification means it holds a mix of Treasuries, agencies, and corporates, aiming to mirror the entire taxable bond market.
In contrast, Vanguard Intermediate-Term Corporate Bond ETF focuses exclusively on investment-grade corporate debt, holding 2,249 fixed-income investments. Its largest allocations are to Meta Platforms Inc. (META 2.43%) 4.88% 11/15/2035, United States Treasury Note/Bond 4.00% 11/15/2035, and Bank of America Corp. (BAC 3.36%) 5.01% 07/22/2033, all with small weights. While both funds are classified under “Cash & Others” in sector terms, VCIT’s pure corporate focus leads to higher yield and volatility, while BND’s diversified approach smooths out risk across sectors and issuers.
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What this means for investors
While both are most concentrated in intermediate-term bonds, these two Vanguard ETFs play different roles in a portfolio. The Vanguard Total Bond Market will offer greater stability, with roughly 70% of the holdings U.S. government bonds.
As of Feb. 3, it had a one-year return of 6.7% and a three-year annualized return of 3.6%. Longer-term, the returns are lower, -0.2% over the past five years and 1.9% across the past 10, on an annualized basis.
The Vanguard Intermediate-Term Corporate Bond ETF has more volatile returns because it invests almost exclusively in corporate bonds. Some 94% of the portfolio is in A or BBB bonds, with 49% in BBB-rated bonds and 45% in A-rated bonds. This is the lower end of the investment-grade spectrum, particularly the BBB bonds, where you get higher returns but more volatility.
But over time, the returns have been considerably better for the Vanguard Intermediate-Term Corporate Bond ETF. It has returned 8.9% over the past year, and for the three- and five-year periods it has returned 5.8% and 1.0% on an annualized basis. Further, its 10-year annualized return is 3.5%.
Plus, both have the same low expense ratio. So, it really depends on what you’re looking for, but over time, the Vanguard Intermediate-Term Corporate Bond ETF has certainly been the better performer.
