VGIT Offers Lower Costs While FIGB Provides Broader Exposure

Core Insights - The key differences between Vanguard Intermediate-Term Treasury ETF (VGIT) and Fidelity Investment Grade Bond ETF (FIGB) are cost, yield, portfolio breadth, and historical risk, with VGIT being cheaper and steadier while FIGB offers a higher payout and broader bond exposure [1][2] Cost and Size Comparison - VGIT has an expense ratio of 0.03%, significantly lower than FIGB's 0.36% [3][4] - The 1-year return for VGIT is 1.7%, while FIGB offers a higher return of 2.8% [3] - VGIT has a dividend yield of 3.8%, compared to FIGB's 4.1% [3][4] - VGIT's assets under management (AUM) stand at $44.6 billion, whereas FIGB has $354.6 million [3] - VGIT has a beta of 0.82, indicating lower volatility compared to FIGB's beta of 1.01 [3] Performance and Risk Comparison - Over the past four years, VGIT experienced a maximum drawdown of 13.4%, while FIGB had a drawdown of 15.6% [5] - The growth of $1,000 invested over four years is $1,056 for VGIT and $1,050 for FIGB, indicating VGIT's slightly better performance [5] Portfolio Composition - FIGB invests in 707 positions across high-grade U.S. bonds, with 45% of its portfolio in government bonds and 22% in corporate and securitized bonds [6] - VGIT holds 102 positions exclusively in U.S. Treasury securities, focusing on intermediate maturities of three to ten years, providing pure government exposure [7] Investment Implications - Both VGIT and FIGB are considered solid options for investors seeking quality intermediate-term bond funds in 2026, with both delivering returns over the last four years with minimal drawdowns [8] - FIGB's broader diversification and longer average duration of 5.9 years may lead to better performance if interest rates decline, compared to VGIT's average duration of 4.9 years [9]