Which Is the Better Long-Term Bond ETF: Vanguard's Corporate VCLT or Treasury VGLT?
VCLT delivered stronger five-year returns and lower volatility while offering a 1% yield advantage. Both funds charge just 0.03% in expenses.
Overview
Comparing Vanguard Long-Term Corporate Bond ETF (NASDAQ:VCLT) and Vanguard Long-Term Treasury ETF (NASDAQ:VGLT) highlights a choice between the high credit safety of sovereign debt and the yield premium offered by investment-grade corporate bonds.
Both funds serve as long-duration anchors, focusing on fixed-income maturities between 10 and 25 years. While VGLT holds sovereign debt backed by the U.S. government, VCLT targets corporate credit, offering higher income potential in exchange for taking on additional default risk.
Details
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Source
Originally published at www.fool.com.