Vanguard Total Bond Market Index Fund
BND BondUpdated: Jul 5, 2026, 21:17 UTC
Key Metrics
About This ETF
The Vanguard Total Bond Market Index Fund (BND) is a Bond ETF with an expense ratio (TER) of 0.03% and $394.4B in assets under management. The ETF currently yields 3.94% in dividends. Year-to-date, BND has returned +0.37%. With an expense ratio of just 0.03%, it is one of the cheapest ETFs in its category.
This index measures the performance of a wide spectrum of public, investment-grade, taxable, fixed income securities in the United States-including government, corporate, and international dollar-denominated bonds, as well as mortgage-backed and asset-backed securities-all with maturities of more than 1 year. All of the fund's investments will be selected through the sampling process, and at least 80% of its assets will be invested in bonds held in the index.
📊 In-depth comparison:
Bond ETF comparison ›FAQ — BND
What is the TER of BND (Vanguard Total Bond Market Index Fund)?
BND has a Total Expense Ratio (TER) of 0.03 % per year. That sits below the bond category median (0.15 % across 8 peer ETFs). The TER is deducted directly from the fund and lowers your effective return.
What return has BND delivered?
Performance for BND: YTD: +0.37 % · 3-year p.a.: +4.27 % · 5-year p.a.: +0.02 %. Over 5 years, BND underperforms the bond category median of +0.21 % by -0.19 pp. Past performance is no guarantee of future returns.
Does BND pay dividends?
BND has a current dividend yield of 3.94 %. Distributing ETFs pay this out in cash; accumulating versions reinvest it inside the fund. Check the share class on your broker before buying.
Where can I buy or set up a savings plan for BND?
BND is available at most major brokers. For a free monthly savings plan from €1, look at Trade Republic, Scalable Capital or Flatex. The broker comparison on this site shows fees, free-savings-plan ETFs and execution exchanges side by side.
What is the Vanguard Total Bond Market ETF (BND)?
BND tracks a broad spectrum of US investment-grade bonds: Treasuries, corporate debt, and mortgage- and asset-backed securities with maturities over one year. With an ultra-low expense ratio of 0.03% and $389.7B in assets, it ranks among the world's largest bond funds. Within a portfolio it serves as a fixed-income stability anchor and diversifier alongside equities – a source of income and ballast rather than an engine for growth.
Performance in a Bond Context
Unlike equity funds, BND lives off ongoing interest income rather than price appreciation. Its distribution yield stands at 3.93%, reflecting current yields across the US bond market. The annualized 3-year return is 4.19%, yet the 5-year return is only 0.14% – a direct imprint of the rate-tightening cycle, when rising policy rates pushed bond prices lower. Year-to-date the fund has gained 0.46%. The price sits at $73.42, roughly 40.5% within its 52-week range ($72.19 to $75.23). When rates fall, bond prices typically rise; when rates rise, they fall – this dynamic shapes returns far more than it does for stocks.
Risk Profile
The central risk is interest-rate risk: when market rates rise, the prices of existing bonds fall, which explains the weak 5-year return of 0.14%. The broad market's duration makes the fund noticeably rate-sensitive. Credit risk, by contrast, is low, since the fund holds only investment-grade paper with a heavy share of government and agency bonds.
- Currency risk: the fund is denominated in USD – euro-area investors face exchange-rate swings on top.
- Inflation risk: rising inflation can erode the real return on fixed coupons.
- The narrow 52-week range ($72.19 to $75.23) illustrates lower volatility than equities.
Who Is BND Suited For?
The fund suits investors seeking fixed-income ballast and predictable income for their portfolio. Its 3.93% distribution yield and modest volatility make it a classic diversifier that often stabilizes returns when equities decline.
- Well suited to balanced or defensive strategies, investors nearing retirement, and anyone who values ongoing income.
- Less suited to young investors with very long horizons and an all-equity focus aiming for maximum growth – bonds dampen expected returns there.
- Those wishing to avoid currency exposure should weigh the USD denomination.
Individual suitability always depends on your goals and risk tolerance.
Comparison with Alternatives
BND competes with several bond ETFs of differing focus:
- iShares Core US Aggregate Bond (AGG): A nearly identical approach tracking the same Bloomberg Aggregate index; the choice usually comes down to cost and trading venue. BND stands out with its very low 0.03% expense ratio.
- Vanguard Total International Bond (BNDX): Adds international, currency-hedged bonds outside the US – useful for geographic diversification alongside the purely US-focused BND.
- Short-duration ETFs: Funds holding short-maturity bonds react far less to rate changes than BND with its intermediate duration, making them appealing to rate-cautious investors.
With $389.7B in assets, BND offers deep liquidity.
Where can I buy BND?
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