For individual investors out there who want to hold something that provides steady monthly income without excessive credit risk, the Fidelity Total Bond Fund ETF (NYSE:FBND) has become a popular option. Offering a 4.62% dividend yield, you get broad diversification and active management to make you feel even more comfortable.
The Fidelity Total Bond Fund ETF charges a 0.36% expense ratio, while competitors can charge just 0.03%.
The PIMCO Active Bond ETF pays $4.75 annually per share versus FBND’s $2.14.
The Fidelity Total Bond Fund ETF offers a 6.13% yield with more flexibility to rotate across fixed-income sectors.
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Through September 2025, the Fidelity Total Bond Fund ETF has delivered a 6.57% year-to-date return and a 3.63% percent one-year return, which means it has outperformed the Bloomberg Aggregate Bond Index over the same holding period. Even so, the income landscape has shifted, and as a result, there are some other options out there that might be better for income maximization.
The Fidelity Total Bond ETF holds at least 80% of its assets in investment-grade bonds, while the remaining 20% is allocated to lower-grade debt as opportunities appear. This gives it a strategy that can blend together government, corporate, and other fixed income selections, all selected through Fidelity’s research drive and team-managed process.
This has allowed the fund to deliver approximately 2.88% annually, against the 2.36% return from the Bloomberg US Aggregate Index. This reinforces why many people have chosen the Fidelity Total Bund ETF as an anchor in their fixed-income allocation. Having predictable monthly distributions can be great comfort, and there is no question that it’s a good solution, but this doesn’t mean it’s the only option available for income-driven investors in 2026.
One of the biggest names in the core bond space, the Vanguard Total Bond Market ETF (NASDAQ:BND) is a prime competitor for Fidelity’s crown. Tracking the entire U.S. investment-grade bond market, the Vanguard Total Bond Market ETF keeps costs very low at 0.03% compared to Fidelity’s 0.36%.
Lower fees also improve long-term returns in a segment where performance spreads are often tight. This ETF also adds a 3.83% dividend yield and a $2.84 annual dividend return for every share owned compared to Fidelity’s $2.14, so $0.60 more, which is no small change if you own a sizable block of shares.
Another strong competitor to the Fidelity Total Bond Fund ETF is the iShares Core U.S. Aggregate Bond ETF (NYSE:AGG). For its part, this fund is widely considered a benchmark for investors who want a combination of scale, stability, and simplicity. Tracking the Bloomberg U.S. Aggregate Bond Index, the iShares Core U.S. Aggregate Bond ETF currently offers a 3.87% dividend yield and a $3.87 annual dividend.
Add in an expense ratio of 0.03%, and you are drastically lower than what Fidelity is offering. As a result, iShares Core U.S. Aggregate Bond ETF has become a go-to choice for investors who want to keep costs down while holding a diversified set of treasuries, corporate, and securitized bonds.
While the PIMCO Active Bond ETF (NYSE:BOND) offers a higher expense ratio at 0.60%, the tradeoff here is a whopping $4.75 annual dividend, almost 100% higher than what’s being offered by Fidelity.
Run by one of the respected fixed-income teams the world over, the PIMCO Active Bond ETF is very opportunistic with its bond strategy across various sectors. Best of all, it offers a long history of competitive performance, which is ideal for those who want to focus solely on income generation and do so with a solid track record.
One final alternative investors should consider over the Fidelity Total Bond Fund ETF is the iShares Flexible Income Active ETF (NYSE:BINC). Offering a more adaptive strategy, the managers of this ETF have more freedom to rotate the holdings across fixed-income sectors, which results in a high-yield, currently holding a 6.13% with an annual dividend payout of $3.25.
This means there is more room to outperform during periods when more traditional bond holdings lag, which is good news for investors who want to be more assertive about their fixed income earnings.
At the end of the day, before switching, investors need to know that choosing a bond ETF is more than just yield. You have to weigh the fee structure, risk levels, interest-rate sensitivity, and how each fund would fit into a broader portfolio. After making all of these calculations, you can go ahead and start investing.
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