AGG vs. GOVT
AGG (iShares Core U.S. Aggregate Bond ETF) and GOVT (iShares U.S. Treasury Bond ETF) are both exchange-traded funds - AGG is a Total Bond Market fund tracking the Bloomberg U.S. Aggregate Bond Index, while GOVT is a Government Bonds fund tracking the ICE U.S. Treasury Core Bond Index. Both are passively managed. Over the past 10 years, AGG returned 1.60%/yr vs 0.90%/yr for GOVT. Their correlation of 0.90 suggests significant overlap in exposure. AGG charges 0.03%/yr vs 0.05%/yr for GOVT.
Performance
AGG vs. GOVT - Performance Comparison
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Returns By Period
In the year-to-date period, AGG achieves a 0.42% return, which is significantly higher than GOVT's 0.02% return. Over the past 10 years, AGG has outperformed GOVT with an annualized return of 1.60%, while GOVT has yielded a comparatively lower 0.90% annualized return.
AGG
- 1D
- 0.16%
- 1M
- 0.22%
- YTD
- 0.42%
- 6M
- 0.49%
- 1Y
- 4.69%
- 3Y*
- 4.01%
- 5Y*
- 0.13%
- 10Y*
- 1.60%
GOVT
- 1D
- 0.13%
- 1M
- 0.14%
- YTD
- 0.02%
- 6M
- 0.01%
- 1Y
- 3.37%
- 3Y*
- 2.88%
- 5Y*
- -0.43%
- 10Y*
- 0.90%
AGG vs. GOVT - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
AGG iShares Core U.S. Aggregate Bond ETF | 0.42% | 7.19% | 1.31% | 5.65% | -13.02% | -1.77% | 7.48% | 8.46% | 0.09% | 3.55% |
GOVT iShares U.S. Treasury Bond ETF | 0.02% | 3.77% | 2.95% | 4.17% | -13.39% | -1.11% | 7.28% | 7.36% | 0.26% | 2.19% |
Correlation
The correlation between AGG and GOVT is 0.97 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.97 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.97 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.96 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.92 |
Correlation (All Time) Calculated using the full available price history since Feb 27, 2012 | 0.90 |
The correlation between AGG and GOVT has been stable across timeframes, ranging from 0.90 to 0.97 - a consistent structural relationship.
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Return for Risk
AGG vs. GOVT — Risk / Return Rank
AGG
GOVT
AGG vs. GOVT - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares Core U.S. Aggregate Bond ETF (AGG) and iShares U.S. Treasury Bond ETF (GOVT). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
| AGG | GOVT | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.29 | ||
| Sortino ratioReturn per unit of downside risk | +0.41 | ||
| Omega ratioGain probability vs. loss probability | 1.22 | 1.16 | +0.06 |
| Calmar ratioReturn relative to maximum drawdown | 1.70 | 1.19 | +0.52 |
| Martin ratioReturn relative to average drawdown | 5.21 | 3.47 | +1.74 |
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month. | |||
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Sharpe Ratios by Period
| AGG | GOVT | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 1.24 | 0.95 | +0.29 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.02 | -0.07 | +0.09 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.30 | 0.17 | +0.12 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.59 | 0.26 | +0.33 |
Drawdowns
AGG vs. GOVT - Drawdown Comparison
The maximum AGG drawdown since its inception was -18.43%, roughly equal to the maximum GOVT drawdown of -19.07%. Use the drawdown chart below to compare losses from any high point for AGG and GOVT.
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Drawdown Indicators
| AGG | GOVT | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -18.43% | -19.07% | +0.64% |
Max Drawdown (1Y)Largest decline over 1 year | -2.76% | -2.85% | +0.09% |
Max Drawdown (3Y)Largest decline over 3 years | -6.11% | -5.43% | -0.68% |
Max Drawdown (5Y)Largest decline over 5 years | -17.82% | -16.60% | -1.22% |
Max Drawdown (10Y)Largest decline over 10 years | -18.43% | -19.07% | +0.64% |
Current DrawdownCurrent decline from peak | -1.98% | -7.05% | +5.07% |
Average DrawdownAverage peak-to-trough decline | -2.71% | -5.25% | +2.54% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.90% | 0.97% | -0.07% |
Volatility
AGG vs. GOVT - Volatility Comparison
iShares Core U.S. Aggregate Bond ETF (AGG) has a higher volatility of 1.29% compared to iShares U.S. Treasury Bond ETF (GOVT) at 1.10%. This indicates that AGG's price experiences larger fluctuations and is considered to be riskier than GOVT based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| AGG | GOVT | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.29% | 1.10% | +0.19% |
Volatility (6M)Calculated over the trailing 6-month period | 2.74% | 2.52% | +0.22% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.85% | 3.63% | +0.22% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.09% | 6.04% | +0.05% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 5.40% | 5.22% | +0.18% |
AGG vs. GOVT - Expense Ratio Comparison
AGG has a 0.03% expense ratio, which is lower than GOVT's 0.05% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
Dividends
AGG vs. GOVT - Dividend Comparison
AGG's dividend yield for the trailing twelve months is around 3.98%, more than GOVT's 3.58% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
AGG iShares Core U.S. Aggregate Bond ETF | 3.98% | 3.89% | 3.74% | 3.13% | 2.39% | 1.77% | 2.14% | 2.70% | 2.72% | 2.32% | 2.39% | 2.45% |
GOVT iShares U.S. Treasury Bond ETF | 3.58% | 3.49% | 3.14% | 2.65% | 1.77% | 0.96% | 2.17% | 1.98% | 1.97% | 1.57% | 1.40% | 1.25% |
Frequently Asked Questions
With a correlation of 0.97, AGG and GOVT move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.
AGG has higher volatility (1.29%) compared to GOVT (1.10%). In terms of maximum drawdown, AGG dropped -18.43% vs GOVT's -19.07%.
On 10-year performance, AGG leads with 1.60% vs 0.90% for GOVT. On fees, AGG is cheaper at 0.03% per year. On volatility, GOVT has been the lower-risk option at 1.10%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, AGG has performed better with a 1.60% return vs 0.90%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
AGG is cheaper with a 0.03% expense ratio, compared with 0.05% for GOVT.
AGG has the higher dividend yield at 3.98%, compared with 3.58% for GOVT.
AGG is categorized as Total Bond Market, while GOVT is Government Bonds. AGG tracks Bloomberg U.S. Aggregate Bond Index, while GOVT tracks ICE U.S. Treasury Core Bond Index. Their fees differ too: 0.03% for AGG and 0.05% for GOVT.
AGG currently has the higher Sharpe Ratio (1.24 vs 0.95), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.
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