PZA vs. BND
PZA (Invesco National AMT-Free Municipal Bond ETF) and BND (Vanguard Total Bond Market ETF) are both exchange-traded funds - PZA is a Municipal Bonds fund tracking the BofA ML National Long-Term Core Plus Municipal Securities Index, while BND is a Total Bond Market fund tracking the Bloomberg U.S. Aggregate Float Adjusted Index. Both are passively managed. Over the past 10 years, PZA returned 1.76%/yr vs 1.56%/yr for BND. A 0.53 correlation means they provide meaningful diversification when combined. PZA charges 0.28%/yr vs 0.03%/yr for BND.
Performance
PZA vs. BND - Performance Comparison
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Returns By Period
In the year-to-date period, PZA achieves a 2.66% return, which is significantly higher than BND's 0.49% return. Over the past 10 years, PZA has outperformed BND with an annualized return of 1.76%, while BND has yielded a comparatively lower 1.56% annualized return.
PZA
- 1D
- -0.26%
- 1M
- 2.10%
- YTD
- 2.66%
- 6M
- 2.79%
- 1Y
- 8.47%
- 3Y*
- 3.09%
- 5Y*
- 0.04%
- 10Y*
- 1.76%
BND
- 1D
- 0.11%
- 1M
- 0.64%
- YTD
- 0.49%
- 6M
- 0.57%
- 1Y
- 4.23%
- 3Y*
- 3.96%
- 5Y*
- 0.05%
- 10Y*
- 1.56%
PZA vs. BND - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
PZA Invesco National AMT-Free Municipal Bond ETF | 2.66% | 1.81% | 0.81% | 8.64% | -13.17% | 2.37% | 5.07% | 9.00% | -0.09% | 6.95% |
BND Vanguard Total Bond Market ETF | 0.49% | 7.08% | 1.38% | 5.65% | -13.11% | -1.86% | 7.71% | 8.84% | -0.12% | 3.57% |
Correlation
The correlation between PZA and BND is 0.65, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.65 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.74 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.68 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.63 |
Correlation (All Time) Calculated using the full available price history since Oct 18, 2007 | 0.53 |
The correlation between PZA and BND shifts across timeframes, from 0.53 (all time) to 0.74 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
PZA vs. BND — Risk / Return Rank
PZA
BND
PZA vs. BND - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Invesco National AMT-Free Municipal Bond ETF (PZA) and Vanguard Total Bond Market ETF (BND). 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.
| PZA | BND | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.91 | ||
| Sortino ratioReturn per unit of downside risk | +1.29 | ||
| Omega ratioGain probability vs. loss probability | 1.44 | 1.20 | +0.24 |
| Calmar ratioReturn relative to maximum drawdown | 2.68 | 1.59 | +1.09 |
| Martin ratioReturn relative to average drawdown | 9.46 | 4.52 | +4.95 |
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Drawdowns
PZA vs. BND - Drawdown Comparison
The maximum PZA drawdown since its inception was -24.49%, which is greater than BND's maximum drawdown of -18.58%. Use the drawdown chart below to compare losses from any high point for PZA and BND.
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Drawdown Indicators
| PZA | BND | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -24.49% | -18.58% | -5.91% |
Max Drawdown (1Y)Largest decline over 1 year | -3.18% | -2.68% | -0.50% |
Max Drawdown (3Y)Largest decline over 3 years | -7.89% | -5.92% | -1.97% |
Max Drawdown (5Y)Largest decline over 5 years | -18.55% | -17.91% | -0.64% |
Max Drawdown (10Y)Largest decline over 10 years | -21.69% | -18.58% | -3.11% |
Current DrawdownCurrent decline from peak | -0.92% | -2.15% | +1.23% |
Average DrawdownAverage peak-to-trough decline | -3.94% | -3.06% | -0.88% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.90% | 0.94% | -0.04% |
Volatility
PZA vs. BND - Volatility Comparison
Invesco National AMT-Free Municipal Bond ETF (PZA) and Vanguard Total Bond Market ETF (BND) have volatilities of 1.08% and 1.08%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| PZA | BND | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.08% | 1.08% | 0.00% |
Volatility (6M)Calculated over the trailing 6-month period | 2.95% | 2.77% | +0.18% |
Volatility (1Y)Calculated over the trailing 1-year period | 4.16% | 3.74% | +0.42% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.00% | 6.03% | -0.03% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 7.08% | 5.53% | +1.55% |
PZA vs. BND - Expense Ratio Comparison
PZA has a 0.28% expense ratio, which is higher than BND's 0.03% expense ratio.
Dividends
PZA vs. BND - Dividend Comparison
PZA's dividend yield for the trailing twelve months is around 3.66%, less than BND's 3.96% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
BND Vanguard Total Bond Market ETF | 3.96% | 3.86% | 3.67% | 3.09% | 2.60% | 2.12% | 2.38% | 2.72% | 2.81% | 2.54% | 2.51% | 2.57% |
PZA Invesco National AMT-Free Municipal Bond ETF | 3.66% | 3.55% | 3.22% | 2.91% | 2.68% | 2.34% | 2.44% | 2.81% | 3.19% | 3.04% | 3.23% | 3.59% |
Frequently Asked Questions
PZA and BND have a correlation of 0.65, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
BND has higher volatility (1.08%) compared to PZA (1.08%). In terms of maximum drawdown, PZA dropped -24.49% vs BND's -18.58%.
On 10-year performance, PZA leads with 1.76% vs 1.56% for BND. On fees, BND is cheaper at 0.03% per year. 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, PZA has performed better with a 1.76% return vs 1.56%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
BND is cheaper with a 0.03% expense ratio, compared with 0.28% for PZA.
BND has the higher dividend yield at 3.96%, compared with 3.66% for PZA.
PZA is categorized as Municipal Bonds, while BND is Total Bond Market. PZA tracks BofA ML National Long-Term Core Plus Municipal Securities Index, while BND tracks Bloomberg U.S. Aggregate Float Adjusted Index. They also come from different issuers: Invesco and Vanguard. Their fees differ too: 0.28% for PZA and 0.03% for BND.
PZA currently has the higher Sharpe Ratio (2.05 vs 1.14), 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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