Core Insights - The Vanguard Long-Term Corporate Bond ETF (VCLT) offers lower costs and higher yields compared to the iShares 20 Year Treasury Bond ETF (TLT), which provides greater scale and pure exposure to U.S. Treasuries [1][9] Group 1: Fund Characteristics - TLT focuses exclusively on U.S. Treasuries with maturities over 20 years, while VCLT invests in a diverse range of investment-grade corporate bonds with maturities between 10 and 25 years [2] - VCLT has an expense ratio of 0.03%, significantly lower than TLT's 0.15%, making it more cost-efficient [3][4] - VCLT's dividend yield is 5.4%, compared to TLT's 4.4%, appealing to income-focused investors [3][4] Group 2: Performance and Risk - Over the past year, TLT has returned -4.0%, while VCLT has returned -1.6% [3] - The maximum drawdown over five years for TLT is -45.06%, whereas VCLT's is -34.31%, indicating VCLT's relative resilience [5] - The growth of $1,000 invested over five years would yield $564 for TLT and $695 for VCLT, showcasing VCLT's better performance [5] Group 3: Portfolio Composition - VCLT holds 257 securities across various sectors, including healthcare (14%) and financial services (13%), and applies an ESG screen [6] - TLT consists entirely of U.S. Treasury bonds with 100% of its assets in cash and government debt, making it less exposed to corporate credit risk [7] Group 4: Investment Considerations - Investors must choose between the financial security of U.S. Treasuries offered by TLT and the lower cost and higher yield of corporate bonds from VCLT, with the latter carrying higher credit risk [10][11]

Financial Performance - Net income per share for Q1 2025 was $018, compared to $007 in Q4 2024[10] - Book value per share decreased slightly from $809 in Q4 2024 to $794 in Q1 2025[10] - Dividends declared per common share remained constant at $036[16] - Net portfolio income decreased from $23514 thousand in 2024 to $21348 thousand in 2025[16] Portfolio Characteristics - Average MBS balances increased from $5348 million in Q4 2024 to $5996 million in Q1 2025[14] - The weighted average coupon of the fixed rate MBS portfolio increased from 503% at December 31, 2024, to 532% at March 31, 2025[43, 47] - Economic leverage ratio increased from 73 in Q4 2024 to 78 in Q1 2025[14] - Liquidity decreased from 105% in Q4 2024 to 78% in Q1 2025[14] Hedging and Funding - The weighted average repo rate was 446% as of March 31, 2025[51] - Total notional balance of hedge positions was $(47328) million[56] - Interest rate swaps had a notional balance of $(39093) million with a weighted average pay fix rate of 329%[56]