BND vs. VTEB
BND (Vanguard Total Bond Market ETF) and VTEB (Vanguard Tax-Exempt Bond ETF) are both exchange-traded funds - BND is a Total Bond Market fund tracking the Bloomberg U.S. Aggregate Float Adjusted Index, while VTEB is a Municipal Bonds fund tracking the S&P National AMT-Free Municipal Bond Index. Both are passively managed. Over the past 10 years, BND returned 1.44%/yr vs 1.93%/yr for VTEB. Their 0.68 correlation means they have sometimes moved together and sometimes differently. Both charge a 0.03% expense ratio.
Performance
BND vs. VTEB - Performance Comparison
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Returns By Period
In the year-to-date period, BND achieves a 0.13% return, which is significantly lower than VTEB's 0.78% return. Over the past 10 years, BND has underperformed VTEB with an annualized return of 1.44%, while VTEB has yielded a comparatively higher 1.93% annualized return.
BND
- 1D
- 0.03%
- 1M
- -0.58%
- 6M
- 0.02%
- YTD
- 0.13%
- 1Y
- 2.32%
- 3Y*
- 4.19%
- 5Y*
- -0.20%
- 10Y*
- 1.44%
- ALL TIME*
- 3.02%
VTEB
- 1D
- 0.06%
- 1M
- -1.40%
- 6M
- 0.00%
- YTD
- 0.78%
- 1Y
- 5.14%
- 3Y*
- 3.30%
- 5Y*
- 0.63%
- 10Y*
- 1.93%
- ALL TIME*
- 2.32%
Liquidity Comparison
| Position | Avg. Volume Value (2W) | Avg. Volume Value (1M) | Avg. Volume Value (3M) |
|---|---|---|---|
| $518.24M | $512.19M | $593.29M | |
| $412.59M | $365.82M | $362.23M |
BND vs. VTEB - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
BND Vanguard Total Bond Market ETF | 0.13% | 7.08% | 1.38% | 5.65% | -13.11% | -1.86% | 7.71% | 8.84% | -0.12% | 3.57% |
VTEB Vanguard Tax-Exempt Bond ETF | 0.78% | 3.72% | 1.31% | 6.15% | -7.99% | 1.14% | 5.19% | 7.35% | 1.04% | 4.87% |
Correlation
The correlation between BND and VTEB is 0.72, which is moderate. They have sometimes moved together and sometimes differently, sharing some price drivers without tracking each other closely.
| Correlation | |
|---|---|
Correlation (1Y) Focuses on recent behavior, but can change the most. | 0.72 |
Correlation (3Y) Balances recent behavior with more history. | 0.78 |
Correlation (5Y) Shows whether the relationship held over a longer period. | 0.74 |
Correlation (10Y) Provides a long-term view across more market conditions. | 0.68 |
Correlation (All Time) Calculated using the full available price history since Aug 25, 2015 | 0.68 |
The correlation between BND and VTEB shifts across timeframes, from 0.68 (all time) to 0.78 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
BND vs. VTEB — Risk / Return Rank
BND
VTEB
BND vs. VTEB - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Vanguard Total Bond Market ETF (BND) and Vanguard Tax-Exempt Bond ETF (VTEB). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.
| BND | VTEB | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -1.24 | ||
| Sortino ratioReturn per unit of downside risk | -1.72 | ||
| Omega ratioGain probability vs. loss probability | 1.11 | 1.39 | -0.28 |
| Calmar ratioReturn relative to maximum drawdown | 0.87 | 1.90 | -1.03 |
| Martin ratioReturn relative to average drawdown | 2.15 | 6.17 | -4.02 |
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Drawdowns
BND vs. VTEB - Drawdown Comparison
The maximum BND drawdown since its inception was -18.58%, which is greater than VTEB's maximum drawdown of -17.00%. Use the drawdown chart below to compare losses from any high point for BND and VTEB.
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Drawdown Indicators
| BND | VTEB | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -18.58% | -17.00% | -1.58% |
Max Drawdown (1Y)Largest decline over 1 year | -2.68% | -2.71% | +0.03% |
Max Drawdown (3Y)Largest decline over 3 years | -4.81% | -4.76% | -0.05% |
Max Drawdown (5Y)Largest decline over 5 years | -17.81% | -12.43% | -5.38% |
Max Drawdown (10Y)Largest decline over 10 years | -18.58% | -17.00% | -1.58% |
Current DrawdownCurrent decline from peak | -2.50% | -1.40% | -1.10% |
Average DrawdownAverage peak-to-trough decline | -3.06% | -2.30% | -0.76% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.08% | 0.83% | +0.25% |
Volatility
BND vs. VTEB - Volatility Comparison
Vanguard Total Bond Market ETF (BND) has a higher volatility of 1.04% compared to Vanguard Tax-Exempt Bond ETF (VTEB) at 0.94%. This indicates that BND's price experiences larger fluctuations and is considered to be riskier than VTEB based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| BND | VTEB | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.04% | 0.94% | +0.10% |
Volatility (6M)Calculated over the trailing 6-month period | 2.93% | 2.24% | +0.69% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.63% | 2.74% | +0.89% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.03% | 3.92% | +2.11% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 5.53% | 5.25% | +0.28% |
BND vs. VTEB - Expense Ratio Comparison
Both BND and VTEB have an expense ratio of 0.03%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.
Dividends
BND vs. VTEB - Dividend Comparison
BND's dividend yield for the trailing twelve months is around 4.03%, more than VTEB's 3.42% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
BND Vanguard Total Bond Market ETF | 4.03% | 3.86% | 3.67% | 3.09% | 2.60% | 2.12% | 2.38% | 2.72% | 2.81% | 2.54% | 2.51% | 2.57% |
VTEB Vanguard Tax-Exempt Bond ETF | 3.42% | 3.29% | 3.14% | 2.79% | 2.09% | 1.64% | 1.99% | 2.30% | 2.25% | 1.96% | 1.66% | 0.58% |
Frequently Asked Questions
BND and VTEB have a correlation of 0.72, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
BND has higher volatility (1.04%) compared to VTEB (0.94%). In terms of maximum drawdown, BND dropped -18.58% vs VTEB's -17.00%.
On 10-year performance, VTEB leads with 1.93% vs 1.44% for BND. Both ETFs have the same 0.03% expense ratio. Their volatility is very similar. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, VTEB has performed better with a 1.93% return vs 1.44%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
BND and VTEB have the same expense ratio: 0.03% per year.
BND has the higher dividend yield at 4.03%, compared with 3.42% for VTEB.
BND is categorized as Total Bond Market, while VTEB is Municipal Bonds. BND tracks Bloomberg U.S. Aggregate Float Adjusted Index, while VTEB tracks S&P National AMT-Free Municipal Bond Index.
VTEB currently has the higher Sharpe Ratio (1.89 vs 0.64), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.
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