ETF Versus

BND vs HYG

Vanguard Total Bond Market Index Fund vs iShares iBoxx $ High Yield Corporate Bond ETF

Last updated: 2026-04-02

BND Vanguard

Vanguard Total Bond Market Index Fund (BND) is an exchange-traded fund issued by Vanguard that provides exposure to the broad U.S. investment-grade bond market. It charges a very low expense ratio of 0.03%. The fund offers an attractive dividend yield of 3.93%. Launched in 2007, the fund has a 19-year track record.

AUM: $150.4B ER: 0.03% Yield: 3.93% Since: Apr 3, 2007
HYG iShares

iShares iBoxx $ High Yield Corporate Bond ETF (HYG) is an exchange-traded fund issued by iShares that provides exposure to below-investment-grade U.S. corporate bonds offering higher yields. It charges an above-average expense ratio of 0.49%. The fund offers a high dividend yield of 5.88%. Launched in 2007, the fund has a 19-year track record.

AUM: $16.3B ER: 0.49% Yield: 5.88% Since: Apr 4, 2007

Quick Verdict

BND is significantly cheaper at 0.03% vs 0.49% expense ratio, saving you approximately $900 per $10,000 invested over 10 years. Both funds have delivered similar 1-year returns (-0.0% vs 0.9%), tracking closely. Income investors may prefer HYG for its higher yield (5.9% vs 3.9%).

Key Metrics

Metric BND HYG
Expense Ratio 0.03% 0.49%
Dividend Yield 3.9% 5.9%
Fund Family Vanguard iShares
Category US Aggregate Bond US High Yield Bond

Performance Chart

Indexed to 100 at start (5-year comparison)

80 85 90 95 100 105 2021-04 2022-06 2023-09 2024-12 2026-04
BND -13.3%
HYG -8.9%

Performance Comparison

Period BND HYG Difference
1 Month -1.63% -1.13% -0.50%
3 Months -0.84% -1.61% +0.77%
6 Months -1.20% -1.82% +0.62%
YTD -0.84% -1.61% +0.77%
1 Year -0.03% +0.86% -0.89%
3 Years -0.73% +5.62% -6.35%
5 Years -13.29% -8.89% -4.40%

Fee Impact Over Time

Estimated fee cost difference assuming 8% annual returns

Investment Period BND Fees HYG Fees You Save
$10.000 10 years $60 $960 $900
$10.000 20 years $258 $4.052 $3.794
$10.000 30 years $835 $12.832 $11.997
$50.000 10 years $299 $4.799 $4.499
$50.000 30 years $4.176 $64.162 $59.986
$100.000 30 years $8.352 $128.324 $119.972

Risk Metrics

Based on 5 years of daily returns

Metric BND HYG
Annualized Volatility 6.0% 7.6%
Max Drawdown -21.7% -19.3%
Sharpe Ratio -1.19 -0.80

Dividend Comparison

Metric BND HYG
Annual Dividend (per share) $2.88 $4.67
Dividend Yield 3.92% 5.88%
Distribution Frequency Monthly Monthly

Which One Should You Choose?

Choose BND if...

you want the lowest fees and plan to buy and hold long-term. Over decades, the expense ratio difference compounds significantly.

Choose HYG if...

you prioritize dividend income and want higher regular distributions from your portfolio.

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