Vanguard launched the VTG ETF for the total U.S. treasury bond market in July 2025. I briefly summarize it here.
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After previously having no singular product to capture the entire US treasury bond market in one fell swoop, Vanguard has finally launched a new ETF for it. Its ticker is VTG.
The US treasury bond market is the largest and most liquid segment of fixed income investments. Buying the total US treasury market of short, intermediate, and long bonds provides effective intermediate exposure usually with a weighted average maturity of around 7 years. Previously, Vanguard investors were limited to its intermediate treasury fund VGIT for such exposure, which actually has a slightly shorter effective maturity of about 5 years.
GOVT from iShares has long been the go-to product for the total US treasury bond market with a history of over a decade and AUM of nearly $30 billion. Vanguard has undercut them from the jump with VTG with an expense ratio of 0.03%, whereas GOVT costs 0.05%, so it will be interesting to see if investors start moving from GOVT to VTG and/or if iShares lowers GOVT's fee to compete.
I'm surprised it took them this long, as GOVT has been around since 2012.
Similarly, Bogleheads often prefer total market index funds to construct portfolios. They typically go for Vanguard funds like BND for the total US bond market. I'll be curious to see if many choose to hone in a bit more on exclusively US treasuries now that they can still do so with a total market index fund here with VTG.
In the interest of full disclosure, while we're on the subject, it's also arguably worth noting that SPDR has a comparable product which is SPTB, which launched in mid-2024, has about $100 million in assets, and also has a fee of 0.03%.
VTG seeks to track the Bloomberg U.S. Treasury Total Return Unhedged USD Index, offering all-curve exposure to US government debt securities maturing after at least 1 year.
At the time of writing, VTG has an SEC yield of 4.13%.
What do you think of this new bond fund from Vanguard? Let me know in the comments.
Disclosures: None.
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