VFSTX vs. BSV

Last updated Jun 23, 2026

VFSTX (Vanguard Short-Term Investment-Grade Fund Investor Shares) and BSV (Vanguard Short-Term Bond Index Fund ETF Shares) are both funds - VFSTX is a Total Bond Market fund managed by Vanguard, while BSV is a Short-Term Bond fund tracking the Bloomberg U.S. 1–5 Year Government/Credit Float Adjusted Index. Over the past 10 years, VFSTX returned 2.50%/yr vs 1.90%/yr for BSV. A 0.73 correlation means they provide meaningful diversification when combined. VFSTX charges 0.20%/yr vs 0.03%/yr for BSV.

Performance

VFSTX vs. BSV - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Short-Term Investment-Grade Fund Investor Shares (VFSTX) and Vanguard Short-Term Bond Index Fund ETF Shares (BSV). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VFSTX achieves a 0.48% return, which is significantly higher than BSV's 0.21% return. Over the past 10 years, VFSTX has outperformed BSV with an annualized return of 2.50%, while BSV has yielded a comparatively lower 1.90% annualized return.

VFSTX

• 1D: 0.10%
• 1M: 0.30%
• YTD: 0.48%
• 6M: 0.86%
• 1Y: 4.28%
• 3Y*: 5.52%
• 5Y*: 2.28%
• 10Y*: 2.50%

BSV

• 1D: -0.12%
• 1M: 0.11%
• YTD: 0.21%
• 6M: 0.37%
• 1Y: 3.25%
• 3Y*: 4.47%
• 5Y*: 1.66%
• 10Y*: 1.90%

*Multi-year figures are annualized to reflect compound growth (CAGR)

VFSTX vs. BSV - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VFSTX Vanguard Short-Term Investment-Grade Fund Investor Shares	0.48%	6.75%	4.98%	6.06%	-5.84%	-0.70%	5.16%	5.75%	0.87%	2.02%
BSV Vanguard Short-Term Bond Index Fund ETF Shares	0.21%	6.00%	3.78%	4.90%	-5.49%	-1.09%	4.70%	4.98%	1.34%	1.20%

Correlation

The correlation between VFSTX and BSV is 0.86, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.86
Correlation (3Y) Calculated over the trailing 3-year period	0.87
Correlation (5Y) Calculated over the trailing 5-year period	0.89
Correlation (10Y) Calculated over the trailing 10-year period	0.82
Correlation (All Time) Calculated using the full available price history since Apr 10, 2007	0.73

The correlation between VFSTX and BSV shifts across timeframes, from 0.73 (all time) to 0.89 (5 years), reflecting how their relationship changes across market environments.

Return for Risk

VFSTX vs. BSV — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

VFSTX

VFSTX Risk / Return Rank: 57
VFSTX Sharpe Ratio Rank: 47
VFSTX Sortino Ratio Rank: 73
VFSTX Omega Ratio Rank: 68
VFSTX Calmar Ratio Rank: 48
VFSTX Martin Ratio Rank: 50

BSV

BSV Risk / Return Rank: 55
BSV Sharpe Ratio Rank: 55
BSV Sortino Ratio Rank: 63
BSV Omega Ratio Rank: 57
BSV Calmar Ratio Rank: 52
BSV Martin Ratio Rank: 50

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

VFSTX vs. BSV - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Short-Term Investment-Grade Fund Investor Shares (VFSTX) and Vanguard Short-Term Bond Index Fund ETF Shares (BSV). 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.

Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.

	VFSTX	BSV	Difference
Sharpe ratio: Return per unit of total volatility	1.86	1.79	+0.07
Sortino ratio: Return per unit of downside risk	3.23	2.82	+0.41
Omega ratio: Gain probability vs. loss probability	1.42	1.34	+0.08
Calmar ratio: Return relative to maximum drawdown	2.52	2.53	-0.01
Martin ratio: Return relative to average drawdown	9.67	8.35	+1.32

VFSTX vs. BSV - Sharpe Ratio Comparison

The current VFSTX Sharpe Ratio is 1.86, which is comparable to the BSV Sharpe Ratio of 1.79. The chart below compares the historical Sharpe Ratios of VFSTX and BSV, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

VFSTX vs. BSV - Drawdown Comparison

The maximum VFSTX drawdown since its inception was -9.35%, which is greater than BSV's maximum drawdown of -8.54%. Use the drawdown chart below to compare losses from any high point for VFSTX and BSV.

Drawdown Indicators

	VFSTX	BSV	Difference
Max Drawdown Largest peak-to-trough decline	-9.35%	-8.54%	-0.81%
Max Drawdown (1Y) Largest decline over 1 year	-1.71%	-1.29%	-0.42%
Max Drawdown (3Y) Largest decline over 3 years	-1.71%	-1.53%	-0.18%
Max Drawdown (5Y) Largest decline over 5 years	-9.35%	-8.54%	-0.81%
Max Drawdown (10Y) Largest decline over 10 years	-9.35%	-8.54%	-0.81%
Current Drawdown Current decline from peak	-0.55%	-0.70%	+0.15%
Average Drawdown Average peak-to-trough decline	-1.12%	-0.97%	-0.15%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.44%	0.39%	+0.05%

Volatility

VFSTX vs. BSV - Volatility Comparison

Vanguard Short-Term Investment-Grade Fund Investor Shares (VFSTX) has a higher volatility of 0.79% compared to Vanguard Short-Term Bond Index Fund ETF Shares (BSV) at 0.59%. This indicates that VFSTX's price experiences larger fluctuations and is considered to be riskier than BSV based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VFSTX	BSV	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.79%	0.59%	+0.20%
Volatility (6M) Calculated over the trailing 6-month period	1.71%	1.33%	+0.38%
Volatility (1Y) Calculated over the trailing 1-year period	2.31%	1.82%	+0.49%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	2.98%	2.73%	+0.25%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	2.48%	2.38%	+0.10%

VFSTX vs. BSV - Expense Ratio Comparison

VFSTX has a 0.20% expense ratio, which is higher than BSV's 0.03% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VFSTX vs. BSV - Dividend Comparison

VFSTX's dividend yield for the trailing twelve months is around 4.62%, more than BSV's 4.00% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
BSV Vanguard Short-Term Bond Index Fund ETF Shares	4.00%	3.83%	3.38%	2.46%	1.50%	1.45%	1.79%	2.29%	1.99%	1.65%	1.48%	1.40%
VFSTX Vanguard Short-Term Investment-Grade Fund Investor Shares	4.62%	4.48%	4.06%	3.05%	1.93%	1.70%	2.24%	2.83%	2.68%	2.00%	2.04%	1.99%

Frequently Asked Questions

Can I hold both VFSTX and BSV in my portfolio?

VFSTX and BSV have a correlation of 0.86, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VFSTX or BSV?

VFSTX has higher volatility (0.79%) compared to BSV (0.59%). In terms of maximum drawdown, VFSTX dropped -9.35% vs BSV's -8.54%.

Which has better risk-adjusted returns?

VFSTX currently has the higher Sharpe Ratio (1.86 vs 1.79), 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.