🧺 Aggregate Bond ETFs
🧺 Aggregate Bond ETFs
Aggregate ETFs hold a broad mix of investment-grade bonds — treasuries, corporates, MBS — in one package. They’re the “total stock market” equivalent for bonds.
What’s in an aggregate ETF?
Typical AGG/BND composition:
| Sector | Weight |
|---|---|
| Treasuries | ~40% |
| MBS | ~25% |
| Corporates | ~25% |
| Other | ~10% |
No junk bonds: Aggregate ETFs only hold investment-grade bonds (BBB/Baa or higher). For high-yield, add HYG/JNK separately.
ETFs compared
US Aggregate
| ETF | Duration | Expense | Best For |
|---|---|---|---|
| AGG | ~6.0 years | 0.03% | Benchmark |
| BND | ~6.1 years | 0.03% | Benchmark |
| SCHZ | ~6.2 years | 0.03% | Schwab clients |
AGG and BND are the benchmarks. For most passive bond allocation, these are the default choice.
International/Global
| ETF | Duration | Expense | Best For |
|---|---|---|---|
| BNDX | ~7.2 years | 0.07% | International, hedged |
| BNDW | ~6.6 years | 0.05% | Global (US + international) |
| IAGG | ~7.8 years | 0.07% | International, hedged |
BNDX is hedged to USD — you get local bond returns without currency volatility.
Aggregate vs. component parts
| Approach | Pros | Cons |
|---|---|---|
| Aggregate (AGG/BND) | Simple, auto-rebalanced | No control over mix |
| Component ETFs | Tactical flexibility | More complexity |
For most investors, simplicity wins.
Quick reference
| Goal | ETF |
|---|---|
| Broad US bonds | AGG, BND |
| Lowest cost US | SCHZ |
| International (hedged) | BNDX |
| Global (US + international) | BNDW |
Aggregates are “set and forget” for bond allocation. AGG or BND for US exposure, add BNDX for international diversification, or use BNDW for truly global.
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