The main difference between the XBAL and VBAL ETFs lies in the selection of securities within each ETF.
XBAL is part of the iShares fund family and primarily consists of other iShares exchange traded funds holding securities spanning Canadian, American and international markets.
On the other hand, VBAL holds other Vanguard ETFs comprised of equity and fixed income securities of Canadian, American and international companies.
While the compositions look different for both ETFs, they share a common investment objective: to provide investors with exposure to a globally diversified equity and fixed income portfolio that offers both long-term capital growth and income generation.
Established in 2007, the iShares Core Balanced ETF Portfolio (XBAL) offers investors exposure to diverse asset classes and regions within a single package.
The ETF is comprised of 60.5% equity, 39.1% fixed income and 0.4% cash holdings.
Since inception, XBAL has offered 4.83% annualized growth, including 5.17% in the last 10 years and 5.29% in the last 5 years.
Incepted in 2018, the Vanguard Balanced ETF Portfolio (VBAL) is part of the Vanguard fund family and has assets under management of $2.3 billion as of March 2023.
Similar to its counterpart XBAL, the ETF has roughly 60.6% in equity exposure, 39.4% in fixed income exposure with the remaining balance held in cash and short-term reserves.
Since its inception, VBAL has delivered 4.15% annualized growth, including 4.55% in the last 5 years.
Performance: XBAL vs. VBAL
XBAL Annualized Performance as of March 3, 2023:
- 3-Year: 4.15%
- 5-Year: 5.29%
- 10-Year: 5.17%
VBAL Annualized Performance as of March 3, 2023:
- 3-Year: 4.45%
- 5-Year: 4.55%
XBAL has a Management Expense Ratio (MER) of 0.20% which is largely comprised of its 0.18% management fee.
VBAL has a Management Expense Ratio (MER) of 0.24% which is largely comprised of its 0.22% management fee.
Below are the top holdings within both XBAL and VBAL:
- iShares Core S&P Total US Stock (27.8%)
- iShares Core Canadian Universe Bond Index ETF (24.6%)
- iShares MSCI EAFE IMI Index (15.2%)
- iShares S&P/TSX Capped Composite (15.1%)
- iShares Core Canadian Short Term Corporate Bond Index (6.25%)
- iShares Broad USD Investment Grade Corporate Bond Index (3.87%)
- iShares US Treasury Bond ETF (3.87%)
- USD Cash (0.25%)
- CAD Cash (0.11%)
- Vanguard US Total Market Index ETF (25.7%)
- Vanguard Canadian Aggregate Bond Index ETF (23.2%)
- Vanguard FTSE Canada All Cap Index ETF (18.3%)
- Vanguard FTSE Developed All Cap ex North America Index ETF (12.1%)
- Vanguard Global ex-US Aggregate Bond Index ETF CAD-Hedged (8.3%)
- Vanguard US Aggregate Bond Index ETF CAD-Hedged (7.9%)
- Vanguard FTSE Emerging Markets All Cap Index ETF (4.5%)
Frequently Asked Questions
- Does VBAL pay a dividend?
Yes, VBAL pays a quarterly dividend with an equity yield of 2.4% as of January 31, 2023.
- What are the total fees for VBAL?
The total Management Expense Ratio for VBAL is 0.24% which is largely driven by the 0.22% management fee.
The MER consists of the sum total of the management fee, operating expenses, taxes, and other miscellaneous costs associated with operating the fund in a given year.
- Is VBAL a good investment?
Investments into ETFs should be screened and evaluated just as any other security. Overall, the use of balanced ETFs is ideal for investors seeking robust asset class and geographic diversification. However, it is recommended to review the funds within the ETF and their underlying exposures to different securities and markets before making a final decision. Another consideration is the management fee and MER associated with each ETF. All else equal, a lower fee and MER offers a better investment.