PSBMX vs. PTEAX

Last updated Jun 4, 2026

PSBMX (Principal SmallCap Fund) and PTEAX (Principal Tax-Exempt Bond Fund) are both mutual funds - PSBMX is a Small Cap Blend Equities fund managed by Principal, while PTEAX is a Municipal Bonds fund managed by Principal. Over the past 10 years, PSBMX returned 10.48%/yr vs 2.01%/yr for PTEAX. At a correlation of -0.10, they often move in opposite directions. PSBMX charges 1.31%/yr vs 0.73%/yr for PTEAX.

Performance

PSBMX vs. PTEAX - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Principal SmallCap Fund (PSBMX) and Principal Tax-Exempt Bond Fund (PTEAX). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, PSBMX achieves a 12.65% return, which is significantly higher than PTEAX's 1.38% return. Over the past 10 years, PSBMX has outperformed PTEAX with an annualized return of 10.48%, while PTEAX has yielded a comparatively lower 2.01% annualized return.

PSBMX

• 1D: 0.00%
• 1M: 2.01%
• YTD: 12.65%
• 6M: 10.05%
• 1Y: 34.21%
• 3Y*: 14.84%
• 5Y*: 5.48%
• 10Y*: 10.48%

PTEAX

• 1D: 0.15%
• 1M: 0.77%
• YTD: 1.38%
• 6M: 1.71%
• 1Y: 6.98%
• 3Y*: 3.94%
• 5Y*: 0.36%
• 10Y*: 2.01%

*Multi-year figures are annualized to reflect compound growth (CAGR)

PSBMX vs. PTEAX - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
PSBMX Principal SmallCap Fund	12.65%	14.58%	8.53%	15.11%	-20.51%	19.21%	21.44%	26.97%	-11.42%	12.35%
PTEAX Principal Tax-Exempt Bond Fund	1.38%	4.68%	2.10%	6.35%	-12.18%	2.71%	4.80%	9.05%	0.44%	6.44%

Correlation

The correlation between PSBMX and PTEAX is 0.09, meaning there is essentially no relationship between their price movements. Each responds to its own set of market drivers, making them strong candidates for combining in a diversified portfolio.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.09
Correlation (3Y) Calculated over the trailing 3-year period	0.12
Correlation (5Y) Calculated over the trailing 5-year period	0.09
Correlation (10Y) Calculated over the trailing 10-year period	0.01
Correlation (All Time) Calculated using the full available price history since Jan 3, 2001	-0.10

The correlation between PSBMX and PTEAX shifts across timeframes, from -0.10 (all time) to 0.12 (3 years), reflecting how their relationship changes across market environments.

Return for Risk

PSBMX vs. PTEAX — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

PSBMX

PSBMX Risk / Return Rank: 52
PSBMX Sharpe Ratio Rank: 49
PSBMX Sortino Ratio Rank: 46
PSBMX Omega Ratio Rank: 44
PSBMX Calmar Ratio Rank: 61
PSBMX Martin Ratio Rank: 59

PTEAX

PTEAX Risk / Return Rank: 59
PTEAX Sharpe Ratio Rank: 63
PTEAX Sortino Ratio Rank: 80
PTEAX Omega Ratio Rank: 87
PTEAX Calmar Ratio Rank: 34
PTEAX Martin Ratio Rank: 33

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

PSBMX vs. PTEAX - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Principal SmallCap Fund (PSBMX) and Principal Tax-Exempt Bond Fund (PTEAX). 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.

	PSBMX	PTEAX	Difference
Sharpe ratio: Return per unit of total volatility	2.06	2.33	-0.26
Sortino ratio: Return per unit of downside risk	2.87	3.79	-0.92
Omega ratio: Gain probability vs. loss probability	1.36	1.60	-0.24
Calmar ratio: Return relative to maximum drawdown	3.00	2.21	+0.79
Martin ratio: Return relative to average drawdown	11.82	7.44	+4.38
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

PSBMX vs. PTEAX - Sharpe Ratio Comparison

The current PSBMX Sharpe Ratio is 2.06, which is comparable to the PTEAX Sharpe Ratio of 2.33. The chart below compares the historical Sharpe Ratios of PSBMX and PTEAX, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	PSBMX	PTEAX	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.06	2.33	-0.26
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.25	0.09	+0.16
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.47	0.46	+0.01
Sharpe Ratio (All Time) Calculated using the full available price history	0.39	0.32	+0.07

Drawdowns

PSBMX vs. PTEAX - Drawdown Comparison

The maximum PSBMX drawdown since its inception was -60.15%, which is greater than PTEAX's maximum drawdown of -38.72%. Use the drawdown chart below to compare losses from any high point for PSBMX and PTEAX.

Drawdown Indicators

	PSBMX	PTEAX	Difference
Max Drawdown Largest peak-to-trough decline	-60.15%	-38.72%	-21.43%
Max Drawdown (1Y) Largest decline over 1 year	-12.10%	-3.10%	-9.00%
Max Drawdown (3Y) Largest decline over 3 years	-25.13%	-5.31%	-19.82%
Max Drawdown (5Y) Largest decline over 5 years	-31.32%	-17.37%	-13.95%
Max Drawdown (10Y) Largest decline over 10 years	-42.04%	-17.37%	-24.67%
Current Drawdown Current decline from peak	-0.55%	-0.55%	0.00%
Average Drawdown Average peak-to-trough decline	-10.79%	-5.93%	-4.86%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.06%	0.92%	+2.14%

Volatility

PSBMX vs. PTEAX - Volatility Comparison

Principal SmallCap Fund (PSBMX) has a higher volatility of 4.99% compared to Principal Tax-Exempt Bond Fund (PTEAX) at 1.03%. This indicates that PSBMX's price experiences larger fluctuations and is considered to be riskier than PTEAX based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	PSBMX	PTEAX	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.99%	1.03%	+3.96%
Volatility (6M) Calculated over the trailing 6-month period	13.40%	2.10%	+11.30%
Volatility (1Y) Calculated over the trailing 1-year period	17.59%	2.95%	+14.64%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.01%	4.00%	+18.01%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.37%	4.40%	+17.97%

PSBMX vs. PTEAX - Expense Ratio Comparison

PSBMX has a 1.31% expense ratio, which is higher than PTEAX's 0.73% expense ratio.

Dividends

PSBMX vs. PTEAX - Dividend Comparison

PSBMX's dividend yield for the trailing twelve months is around 4.96%, more than PTEAX's 3.82% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
PSBMX Principal SmallCap Fund	4.96%	5.58%	3.66%	2.91%	0.00%	7.82%	2.28%	5.83%	16.72%	8.65%	2.29%	3.80%
PTEAX Principal Tax-Exempt Bond Fund	3.82%	4.66%	3.73%	2.81%	2.27%	2.15%	2.23%	3.09%	3.68%	3.69%	3.91%	3.75%

Frequently Asked Questions

Can I hold both PSBMX and PTEAX in my portfolio?

PSBMX and PTEAX have a correlation of 0.09, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, PSBMX or PTEAX?

PSBMX has higher volatility (4.99%) compared to PTEAX (1.03%). In terms of maximum drawdown, PSBMX dropped -60.15% vs PTEAX's -38.72%.

Which has better risk-adjusted returns?

PTEAX currently has the higher Sharpe Ratio (2.33 vs 2.06), 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.