VCSH vs SCHO: Corporate Bonds Face Off Against Treasuries
Both funds charge just 0.03% annually, but VCSH offers higher yield while SCHO delivers lower volatility and drawdown risk.
Overview
Vanguard Short-Term Corporate Bond ETF (NASDAQ:VCSH) and Schwab Short-Term U.S. Treasury ETF (NYSEMKT:SCHO) provide low-cost exposure to short-duration debt, differing primarily in their credit quality and yield potential.
Investors seeking to stabilize a portfolio often look toward the short end of the yield curve for lower interest rate sensitivity. These two funds offer liquid, ultra-low-cost entries into the fixed-income market. While they share similar duration targets, their underlying holdings lead to distinct risk-reward profiles in varying economic climates.
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
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Source
Originally published at www.fool.com.