VMBSX vs VTAPX Fund Comparison

A comparison between VMBSX and VTAPX based on their expense ratio, growth, holdings and how well they match their benchmark performance.

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Minafi's Take on VMBSX vs VTAPX

Here's an in depth look at the differences between Vanguard Mortgage-Backed Securities Index Fund Admiral Shares ($VMBSX) and Vanguard Short-Term Inflation-Protected Securities Index Fund Admiral Shares ($VTAPX).

To start off, here's a look at the basics of each fund. Keep an eye on the FI Score. That's a custom score from 0 to 100 that we generate based on how good this fund is for the casual investor. Most investors only need a handful of total funds in their portfolio. The higher the score, the more likely this is one of those few. Score alone isn't enough! Keep reading on to see how different (or perhaps similar) these two funds are.

91% FI Score
  • vmbsx
  • Mutual Fund
  • Bond
  • Government Bond

Vanguard Mortgage-Backed Securities Index Fund Admiral Shares

Expenses: 0.07% (Better than 1% of similar funds)

This is a great choice for a Government Bond Bond fund. See why »

93% FI Score
  • vtapx
  • Mutual Fund
  • Bond
  • Government Bond

Vanguard Short-Term Inflation-Protected Securities Index Fund Admiral Shares

Expenses: 0.06% (Better than 1% of similar funds)

This is a great choice for a Government Bond Bond fund. See why »

Both $VMBSX and $VTAPX are categorized as Mutual Funds. Mutual funds are often offered by 401(k) platforms and are essentially the same as ETFs. Mutual funds are generally offered by an investment platform – Fidelity has Fidelity mutual funds, Vanguard has Vanguard mutual funds. Mutual funds are ideal for retirement investing since you can invest any amount. That allows you to invest every last cent and benefit from the market.

The biggest disadvantage of mutual funds is that you're usually limited to the funds on your investment platform. If you're investing on Fidelity, you'll want to pick Fidelity mutual funds (or any ETF). Same with Vanguard. Some platforms offer mutual funds from other platforms, but they may charge a purchse or redemption fee. I'd recommend using the same platform as your funds – or stick to ETFs.

To learn more about the difference between these two, you can read about the difference between ETFs and Mutual Funds.

When evaluating a fund, the first things I look at are:

  • What it invests in
  • How much it charges in fees
  • How large the fund is

Let's look into these criteria one by one and see if either of these funds stands out.

Fund Holdings Comparison

Both of these funds are Bond Government Bond funds – which means they're likely both investing in about the same investments behind the scenes.

Minafi's FI Score algorithm takes into account the category and market. The more niche a fund is, the lower the score. This doesn't mean it's a worse fund, but it does mean you should stop and make sure this a fund you need to diversify your portfolio.

VMBSX VTAPX
Market Score 9.4 /10 9.9 /10
Category Score 8.0 /10 8.0 /10
Total 17.4 17.9

A score of 10 means this is a solid market and category that almost every investor will want to have investments in. The lower the score, the more specific the investment. These scores are based on when most investors would add these funds to their portfolio. A score of 10 means that this fund (or one like it) belongs in a three-fund portfolio. The lower the score, the farther down in your portfolio a fund would go.

Winner: $VTAPX

Fee Comparison

Fees are one of the biggest killers of portfolio growth. The difference between a 2% fee and a 0.04% fee over 30 years can result in your portfolio having half the total value!

If you're just getting started investing and learning how fees impact your portfolio, I'd encourage you to read through my free investment course (specifically '2.2 - All About Fees') where I go over all the different types of fees you can be charged and how to lower them.

For these two funds, VMBSX has an expense ratio of 0.07% while VTAPX has an expense ratio of 0.06%. In this case, both of these funds have a similar fee.

Winner: $VTAPX (barely)

Fund Size Comparison

Both VMBSX and VTAPX have a similar number of assets under management. VMBSX has 12.5 Billion in assets under management, while VTAPX has 32.4 Billion.

Minafi categorizes both of these funds as large funds. Fund size is a good indication of how many other investors trust this fund. A large fund by itself doesn't mean it's a good fund, but it is one thing to consider when figuring out how to choose the right fund.

Winner: tie

Which Should You Choose? VMBSX or VTAPX?

Since both of these funds are Bond Government Bond funds, you'll most likely only need to invest in one of these funds – not both. Running both of these funds through Minafi's FI Score algorithm, gives VMBSX a score of 91 and VTAPX a score of 93.

Since both of these have a similar FI Score, the difference between these two if minimal. A higher FI Score doesn't mean future growth will be higher, but it does mean that it better fits criteria for a good fund. Honestly though, these two aren't far off. They're both excellent funds.

Winner: tie

$VMBSX

Vanguard Mortgage-Backed Securities Index Fund Admiral Shares

91

Read More
Ratings
Rating Type Rating
Expense Ratio Score 9 /10
Expense Rating 9 /10
Market Score 9 /10
Category Score 8 /10
Overview
Overview Details
Fund Type Mutual Fund
Inception Date Nov-19-2009
Exchange NMFQS
Expense Ratio 0.070%
Net Assets 12.5 Billion
Yield 2.42%
Holdings
Description Info
Market Bond
Category Government Bond
Sectors
  • Agency MBS ARM 0.03%
  • Agency MBS CMO 0.00%
  • Agency MBS Pass-Through 92.38%
  • Asset-Backed 0.00%
  • Cash & Equivalents 7.59%
  • Commercial MBS 0.00%
  • Corporate 0.00%
  • Covered Bond 0.00%
  • Government 0.00%
  • Municipal 0.00%
  • Non-Agency Residential MBS 0.00%
  • Non-U.S. Government 0.00%
  • Other 0.00%
  • Other Government Related 0.00%
  • Securitized 92.41%
  • U.S. Agency 0.00%
  • U.S. Treasury 0.00%
  • U.S. Treasury Inflation-Protected 0.00%

$VTAPX

Vanguard Short-Term Inflation-Protected Securities Index Fund Admiral Shares

93

Read More
Ratings
Rating Type Rating
Expense Ratio Score 9 /10
Expense Rating 9 /10
Market Score 10 /10
Category Score 8 /10
Overview
Overview Details
Fund Type Mutual Fund
Inception Date Oct-16-2012
Exchange NMFQS
Expense Ratio 0.060%
Net Assets 32.4 Billion
Yield 1.92%
Holdings
Description Info
Market Bond
Category Government Bond
Sectors
  • Agency Mortgage-Backed 0.00%
  • Asset-Backed 0.00%
  • Cash & Equivalents 7.64%
  • Commercial MBS 0.00%
  • Corporate 0.00%
  • Covered Bond 0.00%
  • Government 92.36%
  • Government-Related 0.00%
  • Municipal 0.00%
  • Non U.S. Inflation-Protected 0.00%
  • Non U.S. Treasury 0.00%
  • Non-Agency Residential MBS 0.00%
  • Other 0.00%
  • Securitized 0.00%
  • U.S. Treasury 0.00%
  • U.S. Treasury Inflation-Protected 92.36%

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