On the surface, it can be hard to distinguish one total bond market index fund from another.
For instance, five of the funds on our list, all except VBTLX and the sustainable-investing option, primarily track the Bloomberg U.S. Aggregate Bond Index. That’s no accident, since it’s widely considered the main benchmark for the U.S. bond market, covering all major types of fixed income.
A total bond-market fund aims to provide investors with access to a cross-section of the entire investment-grade U.S. bond market in one fund. This streamlines investing and ensures broad representation of the high-credit fixed income universe.
It’s crucial for shareholders to understand that the price of an individual bond or fund will change based on movements in market interest rates. When market interest rates rise, the value of the bond or fund will drop. Older, lower-yielding bonds are replaced with new, higher-yielding…
