Key Points
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Vanguard Long-Term Corporate Bond ETF provides a higher dividend yield and a lower expense ratio than iShares 20+ Year Treasury Bond ETF.
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iShares 20+ Year Treasury Bond ETF holds more assets under management, yet it has suffered a larger maximum drawdown over the past five years.
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Vanguard Long-Term Corporate Bond ETF holds a diversified basket of over 2,700 investment‑grade corporate bonds, while iShares 20+ Year Treasury Bond ETF concentrates on just 48 U.S. Treasury securities.
The Vanguard Long-Term Corporate Bond ETF (NASDAQ:VCLT) concentrates on high‑quality corporate debt, whereas the iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT) tracks long‑term U.S. government obligations.
Both ETFs focus on the long‑end of the yield curve, making them especially sensitive to interest‑rate moves. Although their duration profiles are similar, the key difference is credit risk: VCLT leans on corporate balance sheets, while TLT is backed by the full faith and credit of the United States government. This comparison examines how those distinctions affect yield, expenses, and historical volatility.
Snapshot (cost & size)
MetricVCLTTLTIssuerVanguardiSharesShare price$72.62 (as of 2026-08-27)$83.13 (as of 2026-08-27)Expense ratio0.03%0.15%1-yr return (as of Aug. 27, 2026)1.1%0.3%Dividend yield5.6%4.7%Beta0.630.52AUM$9.6B$47.5B
Beta indicates how much the fund’s price moves relative to the S&P 500, derived from monthly returns over the fund’s history (up to five years). The one‑year return reflects total return over the trailing twelve months, and dividend yield represents the trailing‑12‑month distribution yield.
The Vanguard Long‑Term Corporate Bond ETF is the lower‑cost choice, with an expense ratio of just 0.03% versus 0.15% for the iShares 20+ Year Treasury Bond ETF. It also offers a higher distribution, reflecting the extra yield investors receive for taking on corporate credit risk.
Performance & risk comparison
MetricVCLTTLTMax drawdown (5 yr)(34.3%)(43.8%)Growth of $1,000 over 5 years (total return)$850$658
What’s inside
The iShares 20+ Year Treasury Bond ETF invests in U.S. Treasury securities with maturities longer than 20 years. Launched in 2002, the fund holds 48 issues and has distributed $3.90 per share over the last twelve months. Based on its recent price near $83.13, that equates to a 4.7% yield.
The Vanguard Long‑Term Corporate Bond ETF focuses on investment‑grade corporate bonds maturing between 10 and 25 years. Introduced in 2009, it holds 2,745 issues and is highly diversified—no single position exceeds 0.37% of assets. Over the past year it has paid $4.08 per share, which, at a price around $72.62, translates to a 5.6% yield.
Which looks like the better buy
Long‑term bond investing has tested many investors over the past five years. Both VCLT and TLT endured steep losses during the 2022 rate‑hiking cycle, underscoring that long‑duration bonds are not risk‑free. The decision hinges on whether the extra income from corporate bonds adequately compensates for their added risk.
Over the five‑year horizon, VCLT outperforms TLT on most metrics: it has delivered higher total returns, experienced a smaller maximum drawdown, offers a greater yield, and charges a fraction of the expense. While corporate bonds carry credit risk absent in Treasuries, VCLT’s broad diversification across thousands of investment‑grade issuers has historically mitigated that risk more than skeptics anticipate.
TLT’s appeal lies in its enormous scale and its absence of credit risk. With roughly five times the assets of VCLT, it provides liquidity that few bond funds can match, making it a favored tool for institutional investors seeking a pure government‑backed safe haven. For most long‑term buy‑and‑hold investors, however, VCLT’s lower cost, higher yield, and stronger historical performance make it the more attractive option today.
