AGG vs BND Stock Comparison: AI Score, Valuation, Performance and Upside
AGG (iShares Core US Aggregate Bond ETF) and BND (Vanguard Total Bond Market ETF) are functionally interchangeable core investment-grade bond ETFs — both track essentially the same Bloomberg US Aggregate Bond Index composition, both charge 0.03% expense ratios, both have similar interest rate duration (~6-7 years), and both provide the same diversified exposure to U.S. Treasuries, mortgage-backed securities, and investment-grade corporate bonds. The practical choice between AGG and BND is almost entirely a matter of brokerage preference (AGG for iShares/BlackRock ecosystem users, BND for Vanguard users).
AGG vs BND is two nearly identical core U.S. investment-grade bond ETFs at identical cost — iShares/BlackRock's AGG with slightly higher AUM and trading liquidity versus Vanguard's BND with the investor-owned governance structure alignment and three-fund portfolio integration — effectively the same product in two different packaging.
BND holds the edge across 3 of 5 key metrics in this comparison. BND has delivered stronger 1-year price return (-0.30% vs -0.32% for AGG).
- Use iShares ETFs across their portfolio (AGG, IVV, IEFA) and prefer BlackRock's iShares ecosystem for portfolio consistency or advisor-managed accounts that default to iShares products
- Need maximum bond ETF liquidity for large institutional trades or frequent rebalancing — AGG's slightly higher trading volume provides marginally tighter bid-ask spreads for large transactions
- Invest through a brokerage where AGG is commission-free or has lower transaction costs than BND
- Build a Vanguard three-fund portfolio (VTI + VXUS + BND) as the classic bond allocation component — BND pairs naturally with VTI and VXUS for a complete, low-cost diversified portfolio
- Value Vanguard's investor-owned structure as providing long-term governance alignment toward cost minimization that a profit-driven asset manager cannot structurally match
- Invest at Vanguard brokerage where BND is commission-free and integrates with Vanguard's portfolio analysis and tax-loss harvesting tools
| Metric | AGG | BND |
|---|---|---|
| ETF scorei | 39.0 | 33.0 |
| Latest closei | $96.33 | $71.47 |
| 1M returni | -0.70% | -0.69% |
| 6M returni | -1.18% | -1.11% |
| 1Y returni | -0.32% | -0.30% |
The ETF score weights long-term returns and risk-adjusted performance most heavily, but still rewards low expense ratios, larger fund size, and broader diversification — so it can favor low-cost, broad, mega-cap funds over smaller thematic or actively-managed funds even when the latter have delivered stronger returns.
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | AGG | BND |
|---|---|---|
| 1Y ago | $10.38K (+3.8%) started 2025-09-17 | $10.38K (+3.8%) started 2025-09-17 |
| 5Y ago | $11.68K (+16.8%) started 2021-09-17 | $11.71K (+17.1%) started 2021-09-17 |
| 10Y ago | $15.94K (+59.4%) started 2016-09-19 | $16.33K (+63.3%) started 2016-09-19 |
Hypothetical — past performance does not guarantee future results.
| Metric | AGG | BND |
|---|---|---|
| Expense ratioi | 0.03% | 0.03% |
| Total assets (AUM)i | $138.32B | $398.83B |
| Dividend yieldi | 4.05% | 4.04% |
| Trailing P/Ei | N/A | N/A |
| Betai | 0.27 | 0.26 |
| 52-week change | -0.32% | -0.30% |
| Metric | AGG | BND |
|---|---|---|
| 1Y returni | -0.32% | -0.30% |
| 6M returni | -1.18% | -1.11% |
| 1M returni | -0.70% | -0.69% |
| 1Y Sharpe ratio | -1.26 | -1.28 |
| Betai | 0.27 | 0.26 |
| Dividend yieldi | 4.05% | 4.04% |
| 5Y CAGR | -0.43% | -0.44% |
Over the past year, AGG and BND have moved strongly in the same direction (correlation of 0.99), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | AGG | BND |
|---|---|---|---|
| 1Y | Growthi | -0.32% | -0.30% |
| CAGRi | -0.32% | -0.30% | |
| Volatilityi | 3.78% | 3.68% | |
| Sharpe ratioi | -1.26 | -1.28 | |
| Sortino ratioi | -1.63 | -1.67 | |
| Max drawdowni | 3.27% | 3.16% | |
| Current drawdowni | 2.74% | 2.67% | |
| Avg drawdowni | 1.07% | 1.05% | |
| Ulcer Indexi | 1.35% | 1.31% | |
| Max daily dropi | 0.83% | 0.80% | |
| Max wkly dropi | 1.17% | 1.10% | |
| 5Y | Growthi | -2.12% | -2.19% |
| CAGRi | -0.43% | -0.44% | |
| Volatilityi | 6.12% | 6.04% | |
| Sharpe ratioi | -0.78 | -0.79 | |
| Sortino ratioi | -1.06 | -1.07 | |
| Max drawdowni | 17.66% | 17.78% | |
| Current drawdowni | 2.74% | 2.67% | |
| Avg drawdowni | 7.50% | 7.62% | |
| Ulcer Indexi | 8.85% | 8.97% | |
| Max daily dropi | 1.64% | 1.62% | |
| Max wkly dropi | 3.48% | 3.50% | |
| 10Y | Growthi | +14.68% | +15.32% |
| CAGRi | +1.38% | +1.44% | |
| Volatilityi | 5.42% | 5.54% | |
| Sharpe ratioi | -0.55 | -0.53 | |
| Sortino ratioi | -0.73 | -0.71 | |
| Max drawdowni | 18.43% | 18.58% | |
| Current drawdowni | 3.31% | 3.50% | |
| Avg drawdowni | 4.84% | 4.96% | |
| Ulcer Indexi | 6.88% | 6.99% | |
| Max daily dropi | 4.00% | 5.44% | |
| Max wkly dropi | 7.10% | 8.05% |
| Category | AGG | BND |
|---|---|---|
| Fund name | iShares Core U.S. Aggregate Bond ETF | Vanguard Total Bond Market Index Fund ETF Shares |
| Type | ETF | ETF |
| Expense ratioi | 0.03% | 0.03% |
| Total assets (AUM)i | $138.32B | $398.83B |
| Dividend yieldi | 4.05% | 4.04% |
- Comprehensive investment-grade bond market exposure in one ETF — AGG provides diversified exposure to the entire U.S. investment-grade bond market including Treasuries, MBS, and corporate bonds in proportions matching the overall market
- High liquidity with tight bid-ask spreads — AGG trades billions of dollars daily with institutional trading activity; this liquidity enables large institutional purchases and sales without significant price impact
- iShares brand and BlackRock's fixed income expertise — BlackRock is the world's largest asset manager with extensive fixed income portfolio management experience and extensive securities lending that can minimize AGG's net cost
- Vanguard investor-owned structure drives persistent cost minimization — Vanguard's unique structure creates structural incentive to keep costs low forever, not just when competing with BlackRock; this alignment between fund manager and investor interests is a long-term governance advantage
- Nearly identical portfolio to AGG with equivalent cost — BND and AGG are practically interchangeable; both track Bloomberg Aggregate variations at 0.03%; the choice is primarily about fund family preference
- Massive scale enabling low transaction costs — BND's $300B+ in combined assets provides Vanguard negotiating leverage for bond trading transaction costs and enables efficient portfolio management
- Duration risk — AGG's ~6-7 year duration means a 1% rise in interest rates causes approximately 6-7% price decline; investors holding AGG in a rising rate environment experience mark-to-market losses that recover only as the portfolio rolls to higher-yielding bonds over time
- Mortgage-backed securities complexity — AGG's ~27% MBS allocation introduces prepayment risk (homeowners refinance when rates fall, reducing MBS duration just when investors want longer duration) and credit exposure to government-sponsored enterprises
- Corporate bond credit risk — AGG's investment-grade corporate bond allocation (~24%) can underperform in credit stress periods when corporate bond spreads widen
- Duration risk is identical to AGG — BND's ~6-7 year duration creates the same interest rate sensitivity as AGG; rising rates cause temporary mark-to-market losses that recover over the duration period
- Float-adjusted index creates minor portfolio differences from AGG — BND's Bloomberg Float Adjusted benchmark versus AGG's Bloomberg Aggregate creates very minor composition differences primarily in Treasury holdings; practically irrelevant for most investors
- Bond market liquidity in stress periods — in market stress events (COVID March 2020, October 2023 rate spike), even high-quality bond ETFs like AGG and BND can see bid-ask spreads widen and brief premiums/discounts to NAV
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