⚖️ BNDX vs IAGG Comparison · Free & No Signup

BNDX vs IAGG: The Two Largest International Bond ETFs, Compared

Name: BNDX vs IAGG: expense ratio, index, holdings and returns
Creator: ETF BFF
License: https://etfbff.com/about/

Both BNDX and IAGG provide exposure to non-US bonds hedged back to USD. Both charge nearly identical fees. The choice is mainly about fund family preference.

🔬 Compare top 10 holdings → 💡 Plain-English verdict

🤝 BFF Take

IAGG Edges on Cost — BNDX Wins on AUM and Track Record

BNDX (Vanguard Total International Bond ETF) and IAGG (iShares Core International Aggregate Bond ETF) are the two leading international bond ETFs for US investors. Both are currency-hedged back to USD — meaning you're getting the bond returns without the foreign exchange volatility. BNDX tracks the Bloomberg Global Aggregate ex-USD Float Adjusted RIC Capped Index with ~6,500 bonds at 0.07%; IAGG tracks a similar Bloomberg ex-US index with ~5,700 bonds at 0.06%. BNDX is significantly larger ($65B vs $6B), giving it superior liquidity. The 1 basis point fee difference is negligible. For investors building a global bond portfolio, either works well — BNDX is the dominant standard.

📋 Quick Takeaways

🌍Both hold international government and corporate bonds hedged to USD — removing currency risk from your bond allocation

💰IAGG costs 0.06% vs BNDX's 0.07% — one basis point difference, essentially identical fees

🏦BNDX has $65B AUM vs IAGG's $6B — BNDX is dramatically more liquid and widely held

📊 Data-Based Take: BNDX has the lower fee

Whether the lower-cost fund suits your situation depends on your existing holdings, account type, tax situation, and how you use each fund. This is a cost comparison, not a personalized recommendation.

Both funds trade commission-free at every major brokerage. Where to buy them →

✓ ETF BFF Editorial Team · Data as of Oct 15, 2026 · Educational only, not financial advice

BNDX

Vanguard Total International Bond Index Fund ETF Shares

Expense Ratio

0.07%

1-Year Return

-5.5%

AUM

$121.6B

Holdings

6,500

IAGG

iShares Core International Aggregate Bond ETF

Expense Ratio

0.07%

1-Year Return

-4.7%

AUM

$11.8B

Holdings

5,700

📋 BNDX vs IAGG: Key Facts Side by Side

Metric	BNDX	IAGG
Fund Name	Vanguard Total International Bond Index Fund ETF Shares	iShares Core International Aggregate Bond ETF
Issuer	Vanguard	iShares
Tracks Index	Bloomberg Global Aggregate ex-USD	Bloomberg Global Aggregate ex-USD
Expense Ratio	0.07%	0.07%
Cost per $10K/yr	$7.00	$7.00
AUM	$121.6B	$11.8B
Holdings	6,500	5,700
Inception	2013	2015
1-Year Return	-5.55%	-4.69%
3-Year Return	+3.96%	+4.57%
5-Year Return	+0.11%	+1.05%
Dividend Yield	4.68%	4.58%
Holdings Overlap	See holdings overlap →
Avg Bid-Ask Spread	0.01%	0.02%

AUM and returns updated Oct 15, 2026 from ETF BFF database; expense ratios verified against issuer filings. Returns are annualised. Not investment advice.

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📊 BNDX vs IAGG: Annualised Returns

Annualised returns (trailing, price-based). Past performance does not guarantee future results.

🎯 Which Fund Fits Which Investor?

Often fits investors who...

BNDX

want income and stability with lower portfolio volatility
already use Vanguard and prefer staying within one fund family

Often fits investors who...

IAGG

want income and stability with lower portfolio volatility
already use iShares and prefer staying within one fund family

💰 What the Fee Difference Actually Costs

Adjust the numbers for your situation. This models each fund's expense ratio compounding against your balance over time.

Investment amount$ Years held Expected annual return%

Assumes a constant annual return reinvested, with each fund's expense ratio deducted yearly. Illustrative only; actual returns vary. Past performance does not guarantee future results.

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❓ BNDX vs IAGG: Frequently Asked Questions

What does it mean that BNDX and IAGG are currency-hedged?

Currency hedging means the fund uses financial contracts (typically forward currency agreements) to neutralize the impact of foreign exchange rate movements. When you own foreign bonds, your return depends on both the bond's performance AND the local currency's movement vs the dollar. Hedging removes the currency component, so you receive returns driven purely by bond performance. This makes hedged international bonds more predictable but slightly reduces potential returns in periods when foreign currencies strengthen vs the dollar.

Should I add international bonds to my portfolio?

International bonds add diversification beyond US bonds but have historically provided modest returns, especially hedged. The case for inclusion: global diversification, exposure to non-US interest rate cycles, and completing the "global market portfolio" alongside international stocks. The case against: hedging costs eat into yields, international bond markets have lower returns than US equities over time, and the diversification benefit has been modest. In a standard three-fund portfolio, international bonds are optional — many investors skip them.

What countries are in BNDX and IAGG?

Both hold bonds from developed international markets primarily — Japan (~20%), Germany (~10%), France (~8%), UK (~6%), Italy (~6%), and many others. They also include some emerging market sovereign bonds. The portfolios are dominated by government and quasi-government bonds with high credit quality, making them relatively conservative fixed-income allocations.

How have BNDX and IAGG performed recently?

International bond ETFs had a difficult 2022-2023 period as global central banks raised rates, reducing bond prices. However, since both funds are hedged to USD, much of the currency volatility was removed. Returns have been modestly positive but below what US investors earned in equities. The hedging cost (which varies with interest rate differentials) has been a meaningful drag in recent years as US rates rose significantly above international rates.

Is BND or BNDX better for a bond allocation?

BND (Vanguard Total Bond Market, US bonds only) and BNDX (international bonds) serve different purposes. BND focuses on US investment-grade bonds at a very low 0.03% fee. BNDX adds international diversification at 0.07%. Many investors hold both for global bond coverage, often in a ratio matching global bond market weights. If you can only hold one, BND is the simpler, lower-cost choice for US investors.

New to ETF investing? See answers to the most common ETF questions →

📄 BNDX & IAGG Fact Sheets

BNDX Fact Sheet→ IAGG Fact Sheet→

ℹ️ Data shown is for educational purposes and may not reflect the most current figures. Returns are trailing price-based and exclude dividend reinvestment. Past performance does not guarantee future results. ETF BFF is not a licensed financial advisor. This is not personalized financial advice.