Comparing Income Potential: VCIT vs. VGIT and the Implications of Credit Risk

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Key Points

The Vanguard Intermediate-Term Corporate Bond ETF (NASDAQ:VCIT) reported an 8.8% one-year return and a dividend yield of 4.6%, while the Vanguard Intermediate-Term Treasury ETF (NASDAQ:VGIT) achieved a 6.6% return with a 3.8% yield, as of January 30, 2026. Both funds charge an expense ratio of 0.03% and manage assets under management (AUM) of $61.8 billion and $44.6 billion, respectively.

Over the past five years, VCIT faced a maximum drawdown of 20.56%, while VGIT experienced a drawdown of 15.04%. The growth of $1,000 invested five years ago would have resulted in $872 for VCIT and $867 for VGIT, indicating closely matched performance amid different risk profiles related to corporate credits versus U.S. Treasury securities.

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