SCHP vs. VMBS
SCHP (Schwab U.S. TIPS ETF) and VMBS (Vanguard Mortgage-Backed Securities ETF) are both exchange-traded funds - SCHP is a Inflation-Protected Bonds fund tracking the Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), while VMBS is a Mortgage Backed Securities fund tracking the Barclays Capital U.S. MBS Index. Both are passively managed. Over the past 10 years, SCHP returned 2.52%/yr vs 1.35%/yr for VMBS. A 0.65 correlation means they provide meaningful diversification when combined. SCHP charges 0.03%/yr vs 0.04%/yr for VMBS.
Performance
SCHP vs. VMBS - Performance Comparison
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Returns By Period
In the year-to-date period, SCHP achieves a 0.81% return, which is significantly lower than VMBS's 0.92% return. Over the past 10 years, SCHP has outperformed VMBS with an annualized return of 2.52%, while VMBS has yielded a comparatively lower 1.35% annualized return.
SCHP
- 1D
- 0.00%
- 1M
- -0.18%
- YTD
- 0.81%
- 6M
- 0.88%
- 1Y
- 3.49%
- 3Y*
- 3.67%
- 5Y*
- 0.99%
- 10Y*
- 2.52%
VMBS
- 1D
- 0.09%
- 1M
- 0.63%
- YTD
- 0.92%
- 6M
- 1.02%
- 1Y
- 6.00%
- 3Y*
- 4.52%
- 5Y*
- 0.57%
- 10Y*
- 1.35%
SCHP vs. VMBS - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
SCHP Schwab U.S. TIPS ETF | 0.81% | 6.76% | 1.95% | 3.91% | -12.02% | 5.87% | 10.86% | 8.52% | -1.78% | 3.02% |
VMBS Vanguard Mortgage-Backed Securities ETF | 0.92% | 8.36% | 1.70% | 5.34% | -11.90% | -1.28% | 3.76% | 6.19% | 0.91% | 2.47% |
Correlation
The correlation between SCHP and VMBS is 0.80, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.80 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.85 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.77 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.70 |
Correlation (All Time) Calculated using the full available price history since Aug 5, 2010 | 0.65 |
The correlation between SCHP and VMBS shifts across timeframes, from 0.65 (all time) to 0.85 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
SCHP vs. VMBS — Risk / Return Rank
SCHP
VMBS
SCHP vs. VMBS - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Schwab U.S. TIPS ETF (SCHP) and Vanguard Mortgage-Backed Securities ETF (VMBS). 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.
| SCHP | VMBS | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.35 | ||
| Sortino ratioReturn per unit of downside risk | -0.53 | ||
| Omega ratioGain probability vs. loss probability | 1.18 | 1.25 | -0.07 |
| Calmar ratioReturn relative to maximum drawdown | 1.82 | 2.24 | -0.42 |
| Martin ratioReturn relative to average drawdown | 5.39 | 7.12 | -1.72 |
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Drawdowns
SCHP vs. VMBS - Drawdown Comparison
The maximum SCHP drawdown since its inception was -14.26%, smaller than the maximum VMBS drawdown of -17.47%. Use the drawdown chart below to compare losses from any high point for SCHP and VMBS.
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Drawdown Indicators
| SCHP | VMBS | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -14.26% | -17.47% | +3.21% |
Max Drawdown (1Y)Largest decline over 1 year | -1.93% | -2.68% | +0.75% |
Max Drawdown (3Y)Largest decline over 3 years | -4.48% | -7.65% | +3.17% |
Max Drawdown (5Y)Largest decline over 5 years | -14.26% | -17.12% | +2.86% |
Max Drawdown (10Y)Largest decline over 10 years | -14.26% | -17.47% | +3.21% |
Current DrawdownCurrent decline from peak | -1.04% | -1.07% | +0.03% |
Average DrawdownAverage peak-to-trough decline | -3.92% | -2.49% | -1.43% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.65% | 0.84% | -0.19% |
Volatility
SCHP vs. VMBS - Volatility Comparison
Schwab U.S. TIPS ETF (SCHP) and Vanguard Mortgage-Backed Securities ETF (VMBS) have volatilities of 1.20% and 1.19%, 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
| SCHP | VMBS | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.20% | 1.19% | +0.01% |
Volatility (6M)Calculated over the trailing 6-month period | 2.39% | 3.27% | -0.88% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.35% | 4.30% | -0.95% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 6.11% | 6.78% | -0.67% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 5.59% | 5.41% | +0.18% |
SCHP vs. VMBS - Expense Ratio Comparison
SCHP has a 0.03% expense ratio, which is lower than VMBS's 0.04% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
Dividends
SCHP vs. VMBS - Dividend Comparison
SCHP's dividend yield for the trailing twelve months is around 4.02%, less than VMBS's 4.17% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
SCHP Schwab U.S. TIPS ETF | 4.02% | 4.06% | 2.99% | 3.02% | 7.19% | 4.39% | 1.11% | 2.02% | 2.26% | 1.90% | 1.38% | 0.28% |
VMBS Vanguard Mortgage-Backed Securities ETF | 4.17% | 4.20% | 3.94% | 3.31% | 2.35% | 1.02% | 2.01% | 2.77% | 2.72% | 2.16% | 2.10% | 2.12% |
Frequently Asked Questions
SCHP and VMBS have a correlation of 0.80, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
SCHP has higher volatility (1.20%) compared to VMBS (1.19%). In terms of maximum drawdown, SCHP dropped -14.26% vs VMBS's -17.47%.
On 10-year performance, SCHP leads with 2.52% vs 1.35% for VMBS. On fees, SCHP 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, SCHP has performed better with a 2.52% return vs 1.35%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
SCHP is cheaper with a 0.03% expense ratio, compared with 0.04% for VMBS.
VMBS has the higher dividend yield at 4.17%, compared with 4.02% for SCHP.
SCHP is categorized as Inflation-Protected Bonds, while VMBS is Mortgage Backed Securities. SCHP tracks Bloomberg US Treasury Inflation-Linked Bond Index (Series-L), while VMBS tracks Barclays Capital U.S. MBS Index. They also come from different issuers: Charles Schwab and Vanguard. Their fees differ too: 0.03% for SCHP and 0.04% for VMBS.
VMBS currently has the higher Sharpe Ratio (1.40 vs 1.05), 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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