vbtlx vs vfidx

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Blanco 5.0
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vbtlx vs vfidx

Post by Blanco 5.0 »

I know Vanguard Total Bond Market Index (VBTLX) is more diversified than Intermediate Bond Fund (VFIDX), but can VFIDX serve as the core bond holding in a three fund portfolio? Note it would be in a Roth so taxes are not an issue.
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Beensabu
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Re: vbtlx vs vfidx

Post by Beensabu »

Sure. It's an intermediate-term investment grade bond fund, which is the standard suggestion around here.

Edit: Someone might tell you to pair it with a TIPS fund or other treasury bond fund, though. Since it's pretty much corporate bonds only.
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arcticpineapplecorp.
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Re: vbtlx vs vfidx

Post by arcticpineapplecorp. »

vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
UpperNwGuy
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Re: vbtlx vs vfidx

Post by UpperNwGuy »

arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
Given this information, why would anyone want to hold VFIDX instead of VBTLX?
sycamore
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Re: vbtlx vs vfidx

Post by sycamore »

arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%
FWIW, the Investor share class version (VFICX) has a $3,000 minimum, but the ER jumps from 0.10% to 0.20%.
sycamore
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Re: vbtlx vs vfidx

Post by sycamore »

UpperNwGuy wrote: Sat Oct 16, 2021 8:22 pm
arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
Given this information, why would anyone want to hold VFIDX instead of VBTLX?
One reason is a preference for active management over following an index.
UpperNwGuy
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Re: vbtlx vs vfidx

Post by UpperNwGuy »

sycamore wrote: Sat Oct 16, 2021 9:04 pm
UpperNwGuy wrote: Sat Oct 16, 2021 8:22 pm
arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
Given this information, why would anyone want to hold VFIDX instead of VBTLX?
One reason is a preference for active management over following an index.
Why would a boglehead have a preference for active management when a quick comparison of VFIDX with its passive counterpart VICSX shows that the index fund has both lower costs and better performance?
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arcticpineapplecorp.
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Re: vbtlx vs vfidx

Post by arcticpineapplecorp. »

sycamore wrote: Sat Oct 16, 2021 8:59 pm
arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%
FWIW, the Investor share class version (VFICX) has a $3,000 minimum, but the ER jumps from 0.10% to 0.20%.
thanks. that's another negative though for vficx/vfidx relative to total bond.
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
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arcticpineapplecorp.
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Re: vbtlx vs vfidx

Post by arcticpineapplecorp. »

sycamore wrote: Sat Oct 16, 2021 9:04 pm
UpperNwGuy wrote: Sat Oct 16, 2021 8:22 pm
arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
Given this information, why would anyone want to hold VFIDX instead of VBTLX?
One reason is a preference for active management over following an index.
thanks. didn't realize that.

that's another negative for vfidx relative to vbtlx.
It's hard to accept the truth when the lies were exactly what you wanted to hear. Investing is simple, but not easy. Buy, hold & rebalance low cost index funds & manage taxable events. Asking Portfolio Questions | Wiki
sycamore
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Re: vbtlx vs vfidx

Post by sycamore »

UpperNwGuy wrote: Sat Oct 16, 2021 9:33 pm
sycamore wrote: Sat Oct 16, 2021 9:04 pm
UpperNwGuy wrote: Sat Oct 16, 2021 8:22 pm
arcticpineapplecorp. wrote: Sat Oct 16, 2021 8:05 pm vfidx has $50,000 minimum, total bond has $3000 minimum

vfidx is 0.10%, total bond is 0.05%

vfidx has 52.5% BBB and 4.2% below BBB, total bond has 15.6% (and nothing below BBB)

vfidx has 2271 bonds, total bond has 10,153 bonds

vfidx bond style is medium investment grade corporate, total bond is medium treasury/agency
Given this information, why would anyone want to hold VFIDX instead of VBTLX?
One reason is a preference for active management over following an index.
Why would a boglehead have a preference for active management when a quick comparison of VFIDX with its passive counterpart VICSX shows that the index fund has both lower costs and better performance?
Same reasons a non-Boglehead prefers active management :)

Better performance is never guaranteed, which opens the door for hope -- hope that management has the secret sauce to outperform. Not saying it's a good or logical preference, just that it exists and many people have it.

Also, in the specific case of VFIDX vs VICSX, the former fund had a max drawdown duration and lower volatility and higher Sharpe ratio. Perhaps there are bond investors who value those attributes?
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