What is the primary difference between a long-term government bond ETF and an aggregate bond fund?

Long-term government bond ETFs focus exclusively on US Treasury securities with remaining maturities extending significantly into the future. Unlike aggregate bond funds that mix government and corporate debt, these funds aim solely for government credit safety and specific duration exposure. Duration makes them highly sensitive to interest rate changes. When rates rise, long-term bond prices fall more sharply than short-term bonds. Conversely, when rates fall, long-term bonds see greater price appreciation. This concentrated exposure offers distinct risk-return characteristics compared to diversified fixed-income portfolios.

Why do TLT and VGLT list different inception dates?

TLT launched in July 2002, while VGLT began trading in November 2009. These dates reflect when each fund first offered shares to investors and met its minimum operational requirements. TLT’s earlier inception means it has experienced more complete market cycles, including pre-financial crisis conditions. VGLT’s 2009 start places its initial history squarely within a prolonged period of low interest rates and quantitative easing. Inception dates help investors contextualise historical performance data and understand the specific economic environments each fund has navigated since its creation.

How do the expense ratios of these two ETFs compare?

TLT charges an expense ratio of 0.15%, while VGLT charges a lower 0.03%. The 0.12 percentage point difference represents annual management costs deducted from fund assets. For a hypothetical $10,000 investment, this equates to $15 versus $3 annually before returns. Over extended periods, compounded fee differences create meaningful divergence in final wealth. Lower expenses allow more return to remain invested. While VGLT’s cost advantage is significant, investors should weigh it alongside liquidity needs and tracking methodology rather than treating fee alone as the sole selection criterion for long-term holdings.

Does TLT or VGLT have a higher dividend yield?

VGLT reports a dividend yield of 4.82%, marginally exceeding TLT’s 4.76%. Yields reflect recent distributions divided by current market prices. For long-term Treasury ETFs, these yields stem primarily from coupon payments on underlying government bonds rather than equity dividends. Distribution amounts fluctuate with interest rates and bond prices. Neither fund guarantees stable payout levels. Yield differences of six basis points are minimal and may reverse quickly with market movements. Investors should focus on total return potential from both income and price changes when evaluating either Treasury-focused ETF for portfolio allocation.

Do these ETFs pay dividends monthly or annually?

Neither TLT nor VGLT follows a strict annual-only or fixed monthly schedule in isolation. Long-term Treasury ETFs typically distribute interest income received from underlying bonds on a monthly basis. However, distribution amounts vary depending on coupon payments accrued during each period and whether the fund experiences net gains or losses. These distributions are not guaranteed dividends like those from preferred stocks or REITs. Investors receive pass-through income from interest earned by the Treasury securities held within the respective fund’s portfolio at that time.

Which investing goals are associated with each fund?

Both TLT and VGLT serve portfolios targeting long-duration US government credit exposure. Neither seeks corporate credit or international diversification. Typical uses include hedging equity volatility or positioning for anticipated interest rate declines. TLT’s longer operational history since 2002 and larger asset base may suit investors prioritising trading liquidity. VGLT’s lower expense ratio may align with cost-conscious holders planning extended buy-and-hold periods. Both provide similar economic exposure despite operational differences. Goal fit depends on whether an investor values trading flexibility or annual cost savings more within their fixed-income allocation strategy.

How do assets under management affect these ETFs?

TLT holds $46.7 billion in net assets compared to VGLT’s $10.4 billion. Larger asset bases typically support deeper order books and narrower bid-ask spreads for active traders. TLT’s size may reduce execution costs during high-volume periods. VGLT remains sufficiently large for most individual investors while maintaining Vanguard’s operational scale advantages. Asset levels also influence the fund’s ability to handle significant inflows or outflows without impacting underlying bond prices. Size does not determine investment merit but affects practical trading considerations for certain investor segments and transaction frequencies.

Is the index tracked by either fund currently available?

For both TLT and VGLT, the specific index tracked is listed as not available in the provided data snapshot. While each fund replicates long-term US Treasury exposure, the precise benchmark methodology cannot be verified from current information. Index differences can affect security selection, rebalancing frequency, and tracking error. Without confirmed index names, investors cannot assess if VGLT’s lower cost comes from tracking a different or simpler benchmark than TLT. Check official fund documentation for updated index specifications before drawing conclusions about tracking quality or methodology alignment between these two Treasury ETFs.

Do these Treasury ETFs carry credit risk?

Both TLT and VGLT hold US government bonds, which carry virtually no default risk from the issuing entity. The credit risk is considered minimal because obligations are backed by the full faith and credit of the United States. However, these ETFs still expose investors to interest rate risk and inflation risk. Longer maturities amplify sensitivity to rate changes. While the government is unlikely to fail on payment obligations, bond prices fluctuate significantly before maturity. Credit safety and market price stability are distinct concepts for fixed-income investors evaluating either of these long-term Treasury-focused ETFs.

How do top holdings compare between the two ETFs?

The provided data confirms zero shared securities among the top ten holdings of TLT and VGLT. This occurs because each fund holds specific individual Treasury securities with unique maturity dates, coupon rates, and issue dates. Even when tracking similar indices, minor differences in fund flows, creation/redemption timing, and lot sizes result in distinct top holding lists. Zero overlap in top ten does not indicate fundamentally different exposure. Both funds maintain long-duration US government debt, but exact security composition varies due to operational and structural factors specific to each fund.

Should non-US investors consider tax implications?

Both TLT and VGLT are US-listed ETFs. Non-US investors may face withholding taxes on US source interest income and potential estate tax exposure regardless of their country of residence. These considerations differ from domestic investments held in tax-advantaged accounts. The tax treatment of distributions and capital gains depends on the investor’s home jurisdiction and applicable tax treaties. Consult qualified tax professionals before investing through international brokerage accounts. Tax complexities can materially affect after-tax returns for cross-border investors evaluating either of these long-term US Treasury bond ETFs for inclusion in portfolios.

What does the educational disclaimer mean for this comparison?

This page provides factual information about TLT and VGLT for educational purposes only. It does not constitute personalised financial advice, recommendations, or suitability assessments. Investment decisions should align with individual financial goals, risk tolerance, time horizons, and tax circumstances. Fund data reflects information available at a specific point in time and may change. Past performance indicators like yields or asset sizes do not guarantee future results. Always conduct independent research or consult qualified professionals before investing in any exchange-traded fund or fixed-income security presented here or elsewhere online.

TLT vs VGLT

Two funds, one decision: we compare cost, performance and what each ETF actually holds in September 2026.

Compare TLT and VGLT, two long government Treasury ETFs. This page details their fees, holdings, dividends, and market tracking. TLT has a 0.15% expense ratio and $46.7 billion in assets, while VGLT offers a 0.03% expense ratio and $10.4 billion in assets. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

TLT

Metric

VGLT

0.15%

Expense Ratio

0.03%

4.76%

Dividend Yield

4.82%

$46.71B

Net Assets

$10.43B

Holdings

103

Jul 22, 2002

Inception Date

Nov 19, 2009

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Index Tracked

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Long Government

Fund Category

Long Government

VGLT costs about $12.00 less per year for every $10,000 invested.

Shared Top Holdings

These funds do not share any of their top holdings.

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Investment Analysis

TLT

Pros

TLT holds $46.7 billion in assets, providing substantial liquidity for large trades.
TLT features an expense ratio of 0.15%, which is competitive for long-term government exposure.
TLT offers a dividend yield of 4.76%, reflecting current returns from long-dated US Treasury bonds.

Considerations

TLT’s expense ratio of 0.15% is higher than the 0.03% charged by VGLT.
TLT has a dividend yield of 4.76%, which is lower than the 4.82% paid by VGLT.
TLT is a US-listed ETF, potentially creating tax complexities for non-US investors.

VGLT

Pros

VGLT has a very low expense ratio of 0.03%, significantly cheaper than TLT’s 0.15%.
VGLT offers a higher dividend yield of 4.82% compared to TLT’s 4.76%.
VGLT provides exposure to long-term US government bonds with a $10.4 billion asset base.

Considerations

VGLT is a US-listed ETF, potentially creating tax complexities for non-US investors.
VGLT has fewer assets ($10.4 billion) compared to TLT ($46.7 billion), potentially affecting liquidity.
The specific index tracked by VGLT is not available in the provided data.

About TLT and VGLT

TLT (TLT)

The iShares 20+ Year Treasury Bond ETF (TLT) offers investors exposure to U.S. government bonds with maturities of 20 years or longer. As a long-term government bond fund, it is often influenced significantly by interest rate changes and economic outlooks. When interest rates fall, bond prices generally rise, and vice versa. With a modest expense ratio of 0.15% and net assets of USD 46.71 billion, it is a widely traded vehicle for those looking to diversify beyond equities. The fund holds 49 underlying assets and has an inception date of July 2002. It currently provides a dividend yield of approximately 4.76%. Investors should note that the value of this fund can fluctuate due to changes in long-term interest rates and inflation expectations, meaning returns are not guaranteed. It suits those seeking potential income or diversification, though it carries risks related to interest rate sensitivity.

VGLT (VGLT)

The Vanguard Long-Term Treasury ETF, traded under the ticker VGLT, is an exchange-traded fund designed to provide investors with exposure to US government bonds with longer maturities. As a part of the Vanguard Scottsdale Funds family, it aims to track the performance of long-term Treasury securities issued by the United States government. This fund falls into the 'Long Government' category, reflecting its focus on bonds with significant time to maturity. Investors should be aware that while these bonds are generally considered lower risk due to the backing of the US government, their prices can fluctuate significantly in response to changes in interest rates. The fund offers a relatively low expense ratio, enhancing potential net returns, and pays out income from the underlying Treasury securities. It's essential to understand that bond ETF values can rise and fall, and past performance does not guarantee future results.

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TLT vs VGLT

Fund Snapshot