VGIT vs. VMBS
VGIT (Vanguard Intermediate-Term Treasury ETF) and VMBS (Vanguard Mortgage-Backed Securities ETF) are both exchange-traded funds - VGIT is a Government Bonds fund tracking the Bloomberg U.S. Treasury 3-10 Year Index, while VMBS is a Mortgage Backed Securities fund tracking the Barclays Capital U.S. MBS Index. Both are passively managed. Over the past 10 years, VGIT returned 1.26%/yr vs 1.36%/yr for VMBS. A 0.76 correlation means they provide meaningful diversification when combined. VGIT charges 0.03%/yr vs 0.04%/yr for VMBS.
Performance
VGIT vs. VMBS - Performance Comparison
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Returns By Period
In the year-to-date period, VGIT achieves a -0.32% return, which is significantly lower than VMBS's 0.70% return. Over the past 10 years, VGIT has underperformed VMBS with an annualized return of 1.26%, while VMBS has yielded a comparatively higher 1.36% annualized return.
VGIT
- 1D
- 0.14%
- 1M
- -0.08%
- YTD
- -0.32%
- 6M
- -0.27%
- 1Y
- 3.19%
- 3Y*
- 3.44%
- 5Y*
- 0.07%
- 10Y*
- 1.26%
VMBS
- 1D
- 0.04%
- 1M
- 0.18%
- YTD
- 0.70%
- 6M
- 1.11%
- 1Y
- 6.25%
- 3Y*
- 4.63%
- 5Y*
- 0.49%
- 10Y*
- 1.36%
VGIT vs. VMBS - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
VGIT Vanguard Intermediate-Term Treasury ETF | -0.32% | 7.34% | 1.39% | 4.28% | -10.53% | -2.64% | 7.71% | 6.19% | 1.35% | 1.70% |
VMBS Vanguard Mortgage-Backed Securities ETF | 0.70% | 8.36% | 1.70% | 5.34% | -11.90% | -1.28% | 3.76% | 6.19% | 0.91% | 2.47% |
Correlation
The correlation between VGIT and VMBS is 0.92, 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 | 0.92 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.94 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.92 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.85 |
Correlation (All Time) Calculated using the full available price history since Nov 24, 2009 | 0.76 |
The correlation between VGIT and VMBS shifts across timeframes, from 0.76 (all time) to 0.94 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
VGIT vs. VMBS — Risk / Return Rank
VGIT
VMBS
VGIT vs. VMBS - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Vanguard Intermediate-Term Treasury ETF (VGIT) and Vanguard Mortgage-Backed Securities ETF (VMBS). 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.
| VGIT | VMBS | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.50 | ||
| Sortino ratioReturn per unit of downside risk | -0.71 | ||
| Omega ratioGain probability vs. loss probability | 1.17 | 1.26 | -0.10 |
| Calmar ratioReturn relative to maximum drawdown | 1.13 | 2.34 | -1.21 |
| Martin ratioReturn relative to average drawdown | 3.36 | 7.83 | -4.46 |
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
| VGIT | VMBS | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 0.96 | 1.45 | -0.50 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.01 | 0.07 | -0.06 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.28 | 0.25 | +0.03 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.50 | 0.46 | +0.04 |
Drawdowns
VGIT vs. VMBS - Drawdown Comparison
The maximum VGIT drawdown since its inception was -16.05%, smaller than the maximum VMBS drawdown of -17.47%. Use the drawdown chart below to compare losses from any high point for VGIT and VMBS.
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Drawdown Indicators
| VGIT | VMBS | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -16.05% | -17.47% | +1.42% |
Max Drawdown (1Y)Largest decline over 1 year | -2.83% | -2.68% | -0.15% |
Max Drawdown (3Y)Largest decline over 3 years | -4.34% | -7.65% | +3.31% |
Max Drawdown (5Y)Largest decline over 5 years | -15.02% | -17.12% | +2.10% |
Max Drawdown (10Y)Largest decline over 10 years | -16.05% | -17.47% | +1.42% |
Current DrawdownCurrent decline from peak | -2.26% | -1.29% | -0.97% |
Average DrawdownAverage peak-to-trough decline | -3.52% | -2.49% | -1.03% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.95% | 0.80% | +0.15% |
Volatility
VGIT vs. VMBS - Volatility Comparison
The current volatility for Vanguard Intermediate-Term Treasury ETF (VGIT) is 1.06%, while Vanguard Mortgage-Backed Securities ETF (VMBS) has a volatility of 1.61%. This indicates that VGIT experiences smaller price fluctuations and is considered to be less risky than VMBS based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| VGIT | VMBS | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.06% | 1.61% | -0.55% |
Volatility (6M)Calculated over the trailing 6-month period | 2.33% | 3.16% | -0.83% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.38% | 4.37% | -0.99% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 5.38% | 6.77% | -1.39% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 4.50% | 5.40% | -0.90% |
VGIT vs. VMBS - Expense Ratio Comparison
VGIT has a 0.03% expense ratio, which is lower than VMBS's 0.04% 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
VGIT vs. VMBS - Dividend Comparison
VGIT's dividend yield for the trailing twelve months is around 3.86%, less than VMBS's 4.18% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
VGIT Vanguard Intermediate-Term Treasury ETF | 3.86% | 3.79% | 3.67% | 2.73% | 1.74% | 1.69% | 2.23% | 2.24% | 2.05% | 1.67% | 1.69% | 1.69% |
VMBS Vanguard Mortgage-Backed Securities ETF | 4.18% | 4.20% | 3.94% | 3.31% | 2.35% | 1.02% | 2.01% | 2.77% | 2.72% | 2.16% | 2.10% | 2.12% |
Frequently Asked Questions
With a correlation of 0.92, VGIT and VMBS 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.
VMBS has higher volatility (1.61%) compared to VGIT (1.06%). In terms of maximum drawdown, VGIT dropped -16.05% vs VMBS's -17.47%.
On 10-year performance, VMBS leads with 1.36% vs 1.26% for VGIT. On fees, VGIT is cheaper at 0.03% per year. On volatility, VGIT has been the lower-risk option at 1.06%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, VMBS has performed better with a 1.36% return vs 1.26%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
VGIT is cheaper with a 0.03% expense ratio, compared with 0.04% for VMBS.
VMBS has the higher dividend yield at 4.18%, compared with 3.86% for VGIT.
VGIT is categorized as Government Bonds, while VMBS is Mortgage Backed Securities. VGIT tracks Bloomberg U.S. Treasury 3-10 Year Index, while VMBS tracks Barclays Capital U.S. MBS Index. Their fees differ too: 0.03% for VGIT and 0.04% for VMBS.
VMBS currently has the higher Sharpe Ratio (1.45 vs 0.96), 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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