Vanguard’s VCLT yields 4.9% on corporate debt, while Schwab’s SCHQ provides lower-risk Treasury exposure at the same 0.03% fee.
Vanguard Long-Term Corporate Bond ETF (VCLT) and Schwab Long-Term U.S. Treasury ETF (SCHQ) target different segments of the long-duration bond market, shaping their yield and risk dynamics. Both charge identical 0.03% expense ratios but cater to distinct investor preferences: VCLT focuses on high-quality corporate debt, while SCHQ holds U.S. Treasuries for perceived safety.
SCHQ, launched in 2019, tracks long-duration Treasuries with 100 holdings and paid $1.47 per share over the past year, equating to a 4.9% yield on its $29.9 share price. VCLT, by contrast, reflects the credit premium of corporate bonds, typically offering higher payouts but with added volatility. Both funds share similar duration risks but differ in beta relative to the S&P 500.
The choice between the two hinges on an investor’s appetite for credit risk versus the stability of government-backed securities, with neither fund holding a cost advantage.