ZAG.TO vs. VSB.TO
ZAG.TO (BMO Aggregate Bond Index ETF) and VSB.TO (Vanguard Canadian Short Term Bond) are both Canadian Government Bonds funds - ZAG.TO tracks the FTSE Canada Universe Bond Index while VSB.TO tracks the FTSE Canada Short Term Government Bond Index. Both are passively managed. Over the past 10 years, ZAG.TO returned 1.66%/yr vs 1.94%/yr for VSB.TO. A 0.67 correlation means they provide meaningful diversification when combined. ZAG.TO charges 0.09%/yr vs 0.15%/yr for VSB.TO.
Performance
ZAG.TO vs. VSB.TO - Performance Comparison
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Returns By Period
In the year-to-date period, ZAG.TO achieves a 1.70% return, which is significantly higher than VSB.TO's 0.97% return. Over the past 10 years, ZAG.TO has underperformed VSB.TO with an annualized return of 1.66%, while VSB.TO has yielded a comparatively higher 1.94% annualized return.
ZAG.TO
- 1D
- 0.00%
- 1M
- 1.75%
- YTD
- 1.70%
- 6M
- 0.89%
- 1Y
- 3.25%
- 3Y*
- 4.24%
- 5Y*
- 0.76%
- 10Y*
- 1.66%
VSB.TO
- 1D
- -0.04%
- 1M
- 0.92%
- YTD
- 0.97%
- 6M
- 0.78%
- 1Y
- 2.90%
- 3Y*
- 4.65%
- 5Y*
- 2.02%
- 10Y*
- 1.94%
ZAG.TO vs. VSB.TO - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
ZAG.TO BMO Aggregate Bond Index ETF | 1.70% | 2.25% | 4.48% | 6.41% | -11.60% | -2.60% | 8.34% | 6.84% | 1.12% | 2.45% |
VSB.TO Vanguard Canadian Short Term Bond | 0.97% | 3.66% | 5.54% | 4.92% | -3.93% | -1.15% | 5.29% | 3.06% | 1.67% | -0.36% |
Correlation
The correlation between ZAG.TO and VSB.TO is 0.81, 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 | 0.81 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.84 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.84 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.75 |
Correlation (All Time) Calculated using the full available price history since Dec 7, 2011 | 0.67 |
The correlation between ZAG.TO and VSB.TO shifts across timeframes, from 0.67 (all time) to 0.84 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
ZAG.TO vs. VSB.TO — Risk / Return Rank
ZAG.TO
VSB.TO
ZAG.TO vs. VSB.TO - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for BMO Aggregate Bond Index ETF (ZAG.TO) and Vanguard Canadian Short Term Bond (VSB.TO). 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.
| ZAG.TO | VSB.TO | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.80 | ||
| Sortino ratioReturn per unit of downside risk | -1.09 | ||
| Omega ratioGain probability vs. loss probability | 1.13 | 1.30 | -0.17 |
| Calmar ratioReturn relative to maximum drawdown | 1.17 | 2.04 | -0.87 |
| Martin ratioReturn relative to average drawdown | 2.73 | 6.78 | -4.05 |
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
| ZAG.TO | VSB.TO | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 0.73 | 1.53 | -0.80 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.12 | 0.79 | -0.67 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.23 | 0.56 | -0.32 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.45 | 0.64 | -0.19 |
Drawdowns
ZAG.TO vs. VSB.TO - Drawdown Comparison
The maximum ZAG.TO drawdown since its inception was -18.03%, which is greater than VSB.TO's maximum drawdown of -8.38%. Use the drawdown chart below to compare losses from any high point for ZAG.TO and VSB.TO.
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Drawdown Indicators
| ZAG.TO | VSB.TO | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -18.03% | -8.38% | -9.65% |
Max Drawdown (1Y)Largest decline over 1 year | -2.79% | -1.43% | -1.36% |
Max Drawdown (3Y)Largest decline over 3 years | -5.42% | -1.43% | -3.99% |
Max Drawdown (5Y)Largest decline over 5 years | -15.77% | -6.88% | -8.89% |
Max Drawdown (10Y)Largest decline over 10 years | -18.03% | -8.38% | -9.65% |
Current DrawdownCurrent decline from peak | -1.09% | -0.13% | -0.96% |
Average DrawdownAverage peak-to-trough decline | -3.54% | -0.95% | -2.59% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.19% | 0.43% | +0.76% |
Volatility
ZAG.TO vs. VSB.TO - Volatility Comparison
BMO Aggregate Bond Index ETF (ZAG.TO) has a higher volatility of 1.68% compared to Vanguard Canadian Short Term Bond (VSB.TO) at 0.71%. This indicates that ZAG.TO's price experiences larger fluctuations and is considered to be riskier than VSB.TO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| ZAG.TO | VSB.TO | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.68% | 0.71% | +0.97% |
Volatility (6M)Calculated over the trailing 6-month period | 3.43% | 1.57% | +1.86% |
Volatility (1Y)Calculated over the trailing 1-year period | 4.46% | 1.90% | +2.56% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.58% | 2.57% | +4.01% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 7.11% | 3.48% | +3.63% |
ZAG.TO vs. VSB.TO - Expense Ratio Comparison
ZAG.TO has a 0.09% expense ratio, which is lower than VSB.TO's 0.15% 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
ZAG.TO vs. VSB.TO - Dividend Comparison
ZAG.TO's dividend yield for the trailing twelve months is around 3.42%, more than VSB.TO's 3.00% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
VSB.TO Vanguard Canadian Short Term Bond | 3.00% | 3.04% | 3.04% | 2.66% | 2.24% | 2.02% | 2.24% | 2.31% | 2.29% | 2.34% | 2.45% | 2.38% |
ZAG.TO BMO Aggregate Bond Index ETF | 3.42% | 3.48% | 3.44% | 3.47% | 3.56% | 3.04% | 2.88% | 3.03% | 2.92% | 2.95% | 3.07% | 3.13% |
Frequently Asked Questions
ZAG.TO and VSB.TO have a correlation of 0.81, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
On fees, ZAG.TO is cheaper at 0.09% per year. The better choice depends on whether you care most about return, fees, risk, or income.
ZAG.TO is cheaper with a 0.09% expense ratio, compared with 0.15% for VSB.TO.
ZAG.TO tracks FTSE Canada Universe Bond Index, while VSB.TO tracks FTSE Canada Short Term Government Bond Index. They also come from different issuers: BMO and Vanguard. Their fees differ too: 0.09% for ZAG.TO and 0.15% for VSB.TO.
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