WATFX vs. AGG

Last updated Jun 4, 2026

WATFX (Western Asset Core Bond Fund) and AGG (iShares Core U.S. Aggregate Bond ETF) are both funds - WATFX is a Intermediate Core Bond fund managed by Franklin Templeton, while AGG is a Total Bond Market fund tracking the Bloomberg U.S. Aggregate Bond Index. Over the past 10 years, WATFX returned 1.54%/yr vs 1.57%/yr for AGG. Their correlation of 0.80 suggests significant overlap in exposure. WATFX charges 0.46%/yr vs 0.03%/yr for AGG.

Performance

WATFX vs. AGG - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Western Asset Core Bond Fund (WATFX) and iShares Core U.S. Aggregate Bond ETF (AGG). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, WATFX achieves a 0.02% return, which is significantly lower than AGG's 0.25% return. Both investments have delivered pretty close results over the past 10 years, with WATFX having a 1.54% annualized return and AGG not far ahead at 1.57%.

WATFX

• 1D: 0.00%
• 1M: 0.50%
• YTD: 0.02%
• 6M: 0.02%
• 1Y: 5.58%
• 3Y*: 3.69%
• 5Y*: -0.89%
• 10Y*: 1.54%

AGG

• 1D: -0.21%
• 1M: 0.24%
• YTD: 0.25%
• 6M: 0.09%
• 1Y: 5.14%
• 3Y*: 3.95%
• 5Y*: 0.10%
• 10Y*: 1.57%

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

WATFX vs. AGG - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
WATFX Western Asset Core Bond Fund	0.02%	8.01%	0.44%	5.52%	-17.32%	-2.13%	9.12%	10.44%	-0.62%	5.21%
AGG iShares Core U.S. Aggregate Bond ETF	0.25%	7.19%	1.31%	5.65%	-13.02%	-1.77%	7.48%	8.46%	0.09%	3.55%

Correlation

The correlation between WATFX and AGG 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	0.95
Correlation (5Y) Calculated over the trailing 5-year period	0.96
Correlation (10Y) Calculated over the trailing 10-year period	0.91
Correlation (All Time) Calculated using the full available price history since Sep 29, 2003	0.80

The correlation between WATFX and AGG shifts across timeframes, from 0.80 (all time) to 0.96 (5 years), reflecting how their relationship changes across market environments.

Return for Risk

WATFX vs. AGG — Risk / Return Rank

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

WATFX

WATFX Risk / Return Rank: 23
WATFX Sharpe Ratio Rank: 23
WATFX Sortino Ratio Rank: 24
WATFX Omega Ratio Rank: 22
WATFX Calmar Ratio Rank: 25
WATFX Martin Ratio Rank: 21

AGG

AGG Risk / Return Rank: 36
AGG Sharpe Ratio Rank: 36
AGG Sortino Ratio Rank: 38
AGG Omega Ratio Rank: 35
AGG Calmar Ratio Rank: 37
AGG Martin Ratio Rank: 36

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.

WATFX vs. AGG - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Western Asset Core Bond Fund (WATFX) and iShares Core U.S. Aggregate Bond ETF (AGG). 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.

	WATFX	AGG	Difference
Sharpe ratio Return per unit of total volatility	1.36	1.34	+0.02
Sortino ratio Return per unit of downside risk	2.04	2.00	+0.04
Omega ratio Gain probability vs. loss probability	1.24	1.24	+0.01
Calmar ratio Return relative to maximum drawdown	1.84	1.87	-0.02
Martin ratio Return relative to average drawdown	5.47	5.73	-0.26
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

WATFX vs. AGG - Sharpe Ratio Comparison

The current WATFX Sharpe Ratio is 1.36, which is comparable to the AGG Sharpe Ratio of 1.34. The chart below compares the historical Sharpe Ratios of WATFX and AGG, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	WATFX	AGG	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.36	1.34	+0.02
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	-0.13	0.02	-0.15
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.28	0.29	-0.01
Sharpe Ratio (All Time) Calculated using the full available price history	0.56	0.59	-0.03

Drawdowns

WATFX vs. AGG - Drawdown Comparison

The maximum WATFX drawdown since its inception was -23.69%, which is greater than AGG's maximum drawdown of -18.43%. Use the drawdown chart below to compare losses from any high point for WATFX and AGG.

Drawdown Indicators

	WATFX	AGG	Difference
Max Drawdown Largest peak-to-trough decline	-23.69%	-18.43%	-5.26%
Max Drawdown (1Y) Largest decline over 1 year	-3.04%	-2.76%	-0.28%
Max Drawdown (3Y) Largest decline over 3 years	-8.35%	-6.11%	-2.24%
Max Drawdown (5Y) Largest decline over 5 years	-23.26%	-17.82%	-5.44%
Max Drawdown (10Y) Largest decline over 10 years	-23.69%	-18.43%	-5.26%
Current Drawdown Current decline from peak	-7.35%	-2.14%	-5.21%
Average Drawdown Average peak-to-trough decline	-2.98%	-2.71%	-0.27%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.02%	0.90%	+0.12%

Volatility

WATFX vs. AGG - Volatility Comparison

Western Asset Core Bond Fund (WATFX) has a higher volatility of 1.42% compared to iShares Core U.S. Aggregate Bond ETF (AGG) at 1.30%. This indicates that WATFX's price experiences larger fluctuations and is considered to be riskier than AGG based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	WATFX	AGG	Difference
Volatility (1M) Calculated over the trailing 1-month period	1.42%	1.30%	+0.12%
Volatility (6M) Calculated over the trailing 6-month period	2.87%	2.74%	+0.13%
Volatility (1Y) Calculated over the trailing 1-year period	4.13%	3.85%	+0.28%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	6.83%	6.09%	+0.74%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	5.53%	5.40%	+0.13%

WATFX vs. AGG - Expense Ratio Comparison

WATFX has a 0.46% expense ratio, which is higher than AGG's 0.03% expense ratio.

Dividends

WATFX vs. AGG - Dividend Comparison

WATFX's dividend yield for the trailing twelve months is around 3.93%, less than AGG's 3.99% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
AGG iShares Core U.S. Aggregate Bond ETF	3.99%	3.89%	3.74%	3.13%	2.39%	1.77%	2.14%	2.70%	2.72%	2.32%	2.39%	2.45%
WATFX Western Asset Core Bond Fund	3.93%	4.15%	4.48%	3.35%	2.39%	2.05%	3.90%	3.62%	2.92%	2.34%	2.51%	2.74%

Frequently Asked Questions

Can I hold both WATFX and AGG in my portfolio?

With a correlation of 0.92, WATFX and AGG 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.

Which is riskier, WATFX or AGG?

WATFX has higher volatility (1.42%) compared to AGG (1.30%). In terms of maximum drawdown, WATFX dropped -23.69% vs AGG's -18.43%.

Which has better risk-adjusted returns?

WATFX currently has the higher Sharpe Ratio (1.36 vs 1.34), 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.