ETF Versus

TIP vs VTIP

iShares TIPS Bond ETF vs Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares

Last updated: 2026-04-02

TIP

iShares TIPS Bond ETF (TIP) is an exchange-traded fund that provides exposure to us tips securities. It charges a moderate expense ratio of 0.18%. The fund offers an attractive dividend yield of 2.80%. Launched in 2003, the fund has a 23-year track record.

AUM: $13.9B ER: 0.18% Yield: 2.80% Since: Dec 4, 2003
VTIP

Vanguard Short-Term Inflation-Protected Securities Index Fund ETF Shares (VTIP) is an exchange-traded fund that provides exposure to us tips securities. It charges a very low expense ratio of 0.03%. The fund offers an attractive dividend yield of 3.78%. Launched in 2012, the fund has a 14-year track record.

AUM: $17.0B ER: 0.03% Yield: 3.78% Since: Oct 12, 2012

Quick Verdict

VTIP is significantly cheaper at 0.03% vs 0.18% expense ratio, saving you approximately $297 per $10,000 invested over 10 years. Both funds have delivered similar 1-year returns (-0.1% vs 0.1%), tracking closely. Income investors may prefer VTIP for its higher yield (3.8% vs 2.8%).

Key Metrics

Metric TIP VTIP
Expense Ratio 0.18% 0.03%
Dividend Yield 2.8% 3.8%
Fund Family N/A N/A
Category US TIPS US TIPS

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
TIP -11.9%
VTIP -3.2%

Performance Comparison

Period TIP VTIP Difference
1 Month -1.08% -0.02% -1.06%
3 Months +0.46% +0.85% -0.39%
6 Months -0.62% -0.24% -0.38%
YTD +0.46% +0.85% -0.39%
1 Year -0.08% +0.12% -0.20%
3 Years +0.04% +4.24% -4.20%
5 Years -11.85% -3.24% -8.61%

Fee Impact Over Time

Estimated fee cost difference assuming 8% annual returns

Investment Period TIP Fees VTIP Fees You Save
$10.000 10 years $357 $60 $297
$10.000 20 years $1.529 $258 $1.271
$10.000 30 years $4.912 $835 $4.076
$50.000 10 years $1.786 $299 $1.486
$50.000 30 years $24.558 $4.176 $20.382
$100.000 30 years $49.116 $8.352 $40.764

Risk Metrics

Based on 5 years of daily returns

Metric TIP VTIP
Annualized Volatility 6.5% 3.5%
Max Drawdown -22.0% -11.7%
Sharpe Ratio -1.06 -1.44

Dividend Comparison

Metric TIP VTIP
Annual Dividend (per share) $3.80 $1.88
Dividend Yield 3.44% 3.78%
Distribution Frequency Monthly Quarterly

Which One Should You Choose?

Choose VTIP if...

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

Choose VTIP if...

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

Either works if...

you just need broad us tips exposure. Both are solid options — pick whichever your brokerage offers commission-free.

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