This ETF is for investors who are looking for a stable middle-term profit while keeping their investments safe. Long-term bonds have suffered greatly as they are sensitive to inflation and interest rate change risks. VGLT shares have lost 19% since the beginning of 2022, and it might be worth considering buying.

Two major advantages of bonds should be kept in mind as they are less volatile compared to stocks and they are inclined to return to an average price to level up significant changes from this price. VGLT contains 66 bonds with an average expiration of 24 years and duration of 18 years. Annual yields are at 5.2%, far above other bond ETF’s. This figure may look insignificant at first glance but it is certainly valuable with a 10 year and over investment horizon. It makes the entire portfolio stable thanks to the low negative correlation of bonds and shares that softens turbulence, while receiving stable profit.

Investors may consider a 19% upside of VGLT as its share prices are inclined to return to the average price, as the negative effect of the Fed’s interest rates hike would pass and the Fed would decide to smooth its monetary policy once again. These U.S. bonds are ‘super safe’ and would be redeemed by the U.S. Government.