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ETF Comparison

AGG vs VCIT: Which Is the Better Pick in 2026?

A head-to-head comparison of iShares Core U.S. Aggregate Bond ETF and Vanguard Intermediate-Term Corporate Bond ETF covering yield, cost, risk, and income potential.

Data updated August 19, 2026

Best for

  • AGGInvestors who want fixed-income ballast that steadies the portfolio when stocks fall.
  • VCITInvestors who want higher current income (5.06% vs 4.16% for AGG).

Jump to the side-by-side numbers

Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

AGG has outpaced VCIT over the trailing twelve months, posting a 2.98% total return against 2.50%. The picture flips over 10 years, though — VCIT has compounded at 2.61% a year, ahead of AGG at 1.40%. Figures are total returns: price change plus every distribution reinvested.

Total return and risk statistics by fund. Each row is one fund; each column is one period or statistic.
SymbolYTD1Y3Y5Y10YSince Nov 2009Volatility Sharpe Sortino Max drawdown
AGG0.27%2.98%4.83%-0.18%1.40%2.41%5.3%0.050.07-4.8%
VCIT-0.43%2.50%6.52%0.79%2.61%4.20%5.4%0.340.49-5.1%

Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of August 19, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since Nov 2009” measures every fund from November 23, 2009 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Side-by-side snapshot

Side-by-side snapshot. Each row is one metric; each column is one fund.
MetricAGGVCIT
Full nameiShares Core U.S. Aggregate Bond ETFVanguard Intermediate-Term Corporate Bond ETF
IssueriSharesVanguard
Last Close$97.35 as of August 19, 2026$81.07 as of August 19, 2026
Distribution yield4.16%5.06%
Distribution Safety Score™ 100100
Expense ratio0.03%0.03%
AUM$138B$67.9B
Distribution frequencyMonthlyMonthly
Underlying indexBloomberg U.S. Aggregate Bond IndexUSD investment-grade intermediate-term corporate bonds
ObjectiveProvide exposure to the fund's underlying index or strategy per issuer materials.Provide exposure to the fund's underlying index or strategy per issuer materials.
Asset classFixed IncomeFixed Income
Inception date09/22/200311/19/2009
Beta0.991.07
Last dividend$0.3376$0.3420
Ex-dividend date08/03/202608/03/2026

Bottom lineChoose AGG if you want fixed-income ballast that steadies the portfolio when stocks fall. Choose VCIT if you want higher current income (5.06% vs 4.16% for AGG).

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Income calculator

See how much monthly income a hypothetical investment would generate in each ETF at current yields.

iShares
ETFs473
Total AUM$4710B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

iShares is one of the largest ETF providers globally, known for offering a broad, diversified lineup of exchange-traded funds across multiple asset classes and investment strategies. The company operates 215 funds spanning 15 distinct families, including popular offerings in dividend income, covered call strategies, bonds, equities, ESG-focused investments, and factor-based approaches, with widely-held tickers like AGG (bond), ACWI (global equity), and AOA (allocation). iShares is characterized by its comprehensive fund ecosystem that serves both core portfolio holdings and specialized investment strategies, making it a prominent player for investors seeking both traditional and alternative income-generating ETF solutions.

See our curated list of related YouTube videos on AGG.

See all iShares ETFs
Vanguard
ETFs116
Total AUM$4703B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

Vanguard is one of the largest and most established ETF issuers, known for low-cost, broadly diversified fund offerings built on passive indexing principles. Their lineup spans multiple asset classes and strategies, including core equity and bond index funds, dividend-focused portfolios, ESG-screened options, factor-based strategies, sector exposure, target-date retirement funds, and international investments across developed and emerging markets. The platform is characterized by its emphasis on accessibility and cost efficiency across a comprehensive range of fund families, serving both individual investors seeking broad market exposure and those pursuing specific income, sustainability, or thematic objectives.

See our curated list of related YouTube videos on VCIT.

See all Vanguard ETFs

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Quick verdict

AGG (iShares Core U.S. Aggregate Bond ETF) and VCIT (Vanguard Intermediate-Term Corporate Bond ETF) are both monthly-pay dividend ETFs, but they take different approaches.

VCIT offers the higher yield at 5.06% vs 4.16% for AGG. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

They track different benchmarks: AGG is linked to Bloomberg U.S. Aggregate Bond Index while VCIT tracks USD investment-grade intermediate-term corporate bonds, which means their performance drivers differ.

AGG is the larger fund by assets ($138B), which generally means tighter spreads and better liquidity.

Deep dive

Yield & income

On a $10,000 investment, AGG would generate roughly $34.67/month, while VCIT would produce $42.17/month, at current distribution rates. Both pay monthly distributions.

AGG yield4.16%
VCIT yield5.06%
Monthly diff on $10K$7.50

Cost & efficiency

Over 10 years on $10,000, AGG would cost approximately $30 in fees vs $30 for VCIT (simplified, not compounded). Both charge the same expense ratio.

AGG ER0.03%
VCIT ER0.03%

Strategy & risk

AGG tracks Bloomberg U.S. Aggregate Bond Index with a bonds approach, while VCIT tracks USD investment-grade intermediate-term corporate bonds with a bonds approach. Beta is 0.99 for AGG and 1.07 for VCIT, making AGG the less volatile of the two by this measure.

AGG beta0.99
VCIT beta1.07

Fund details

AGG is managed by iShares (launched 09/22/2003) with $138B in assets. VCIT is managed by Vanguard (launched 11/19/2009) with $67.9B in assets.

AGG AUM$138B
VCIT AUM$67.9B
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Frequently asked questions

What is the current distribution yield for AGG and VCIT?

AGG currently distributes 4.16% and VCIT 5.06%, based on fund data updated August 2026. Distribution yield moves with both the payout and the share price, so check the as-of date before relying on either figure.

Is AGG or VCIT better for dividend income?

It depends on your goals. VCIT currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between AGG and VCIT?

AGG (iShares Core U.S. Aggregate Bond ETF) tracks Bloomberg U.S. Aggregate Bond Index with a bonds approach, while VCIT (Vanguard Intermediate-Term Corporate Bond ETF) tracks USD investment-grade intermediate-term corporate bonds with a bonds approach. They are issued by iShares and Vanguard respectively.

Can I hold both AGG and VCIT?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Is AGG or VCIT safer?

By Dividend Vision's Distribution Safety Score — a rules-based 0–100 estimate of how resilient a distribution looks, where higher is safer — they are effectively tied: AGG scores 100, VCIT scores 100. Neither has a clear safety edge on that measure. No score makes an investment risk-free — treat this as a screening signal, not a guarantee.

Which has lower fees, AGG or VCIT?

AGG and VCIT both charge the same expense ratio of 0.03%, so neither is cheaper on fees — pick based on yield, strategy, or underlying index instead.

How much income does $10,000 in AGG vs VCIT generate?

At current rates, $10,000 in AGG would generate roughly $34.67 per month ($416.00 annually). The same in VCIT would produce about $42.17 per month ($506.00 annually).

Which has performed better historically, AGG or VCIT?

AGG has outpaced VCIT over the trailing twelve months, posting a 2.98% total return against 2.50%. The picture flips over 10 years, though — VCIT has compounded at 2.61% a year, ahead of AGG at 1.40%. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.

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AGG vs VCIT — at a glance

Generated August 16, 2026.

Figures quoted in this analysis are from its generation date and may lag the live snapshot table above, which always shows the latest data.

Overview

AGG and VCIT are both bond ETFs delivering monthly income, but they track very different universes. AGG holds the full Bloomberg U.S. Aggregate Bond Index—a mix of Treasurys, investment-grade corporates, mortgage-backed securities, and other fixed-income assets. VCIT focuses exclusively on intermediate-term investment-grade corporate bonds. The key distinction: AGG is a broad market core holding; VCIT is a sector bet on corporate credit.

How they differ

AGG's $138B in AUM makes it the largest bond ETF in the U.S. and represents the entire taxable U.S. bond market. VCIT's $67.6B is substantial but half that size, and it ignores Treasurys and securitized assets entirely to concentrate on corporate bonds alone. That focus pushes VCIT's yield to 5.05% versus AGG's 4.16%—a meaningful 89-basis-point spread reflecting corporate credit premium. Both charge minimal fees (0.03% and 0.04%, respectively), but VCIT's beta of 1.07 indicates slightly more interest-rate and credit sensitivity than AGG's 0.99, meaning VCIT will amplify moves in the broader bond market.

Who each is best for

AGG: Fits investors who want a single, low-cost holding that mirrors the entire U.S. bond market and need broad diversification across asset types, durations, and credit qualities. Works well as a core fixed-income allocation.

VCIT: Fits investors seeking higher income from investment-grade corporate bonds and willing to accept greater sensitivity to corporate credit spreads and intermediate-term rate moves in exchange for yield pickup.

Key risks to know

  • Corporate credit spread risk for VCIT. With no Treasury ballast, VCIT's NAV moves sharply if corporate credit spreads widen during economic stress. AGG absorbs such widening across a larger portfolio mix, dampening the impact.
  • Interest-rate sensitivity difference. VCIT's beta of 1.07 versus AGG's 0.99 suggests VCIT will decline more in rising-rate environments. If intermediate-term rates rise 1%, VCIT is likely to underperform AGG by a comparable margin.
  • Lack of diversification in VCIT. Holding only investment-grade corporates exposes VCIT to sector concentration risk—a sharp downturn in corporate earnings or credit conditions affects the entire fund similarly, whereas AGG's Treasurys and mortgage-backed securities provide offsetting stability.
  • Reinvestment timing. Both funds distribute monthly, which can lock in higher or lower reinvestment yields depending on rate cycles. Investors using these yields for spending should monitor whether distribution amounts track underlying bond yields.

Bottom line

If you want a market-tracking core bond holding and minimal credit risk, AGG stands out—its massive scale, low cost, and broad diversification make it hard to beat. If you're willing to take on corporate credit and rate risk for an extra 89 basis points of yield, VCIT offers meaningfully higher income. Past performance does not predict future results.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

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The metrics behind this comparison, explained in the Academy.

Bond fund basics How to read a fund's stats Why total return beats chasing yield

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