iShares Core Total US Bond Market ETFAGG

Morningstar Rating

ETF Research and Analysis

by John Gabriel

Suitability
For core fixed-income exposure, it doesn't get much cheaper than iShares Core Total U.S. Bond Market AGG. This broadly diversified fund of U.S. investment-grade bonds can serve as the anchor for the fixed-income slice of Read more

Bull Case

The fund's low fee gives it an instant advantage over its actively managed peers.

The fund features good liquidity and ample daily trading volume, which has translated into tight bid-ask spreads.

The fund is made up of high-quality bonds that can provide stability to a portfolio and will benefit in the event of a flight to quality. Read more

Bear Case

Considering the fund's significant exposure to medium and long-term maturities, as well as the historically low yields of government bonds, unexpected inflation could pose a threat to future returns.

After considering the impact of brokerage fees, going the ETF route for broad bond exposure may be less appealing to some investors who prefer to make smaller, more frequent contributions to a fund and reinvest their distributions. Read more