VCRM vs. VGMS

Last updated Jun 25, 2026

VCRM (Vanguard Core Tax-Exempt Bond ETF) and VGMS (Vanguard Multi-Sector Income Bond ETF) are both exchange-traded funds - VCRM is a Municipal Bonds fund tracking the S&P Broad AMT-Free Municipal Bond Index, while VGMS is a Multisector Bonds fund actively managed by Vanguard. VCRM is passively managed, while VGMS is actively managed. Over the past year, VCRM returned 7.75% vs 6.37% for VGMS. A 0.51 correlation means they provide meaningful diversification when combined. VCRM charges 0.12%/yr vs 0.30%/yr for VGMS.

Performance

VCRM vs. VGMS - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Core Tax-Exempt Bond ETF (VCRM) and Vanguard Multi-Sector Income Bond ETF (VGMS). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VCRM achieves a 2.39% return, which is significantly higher than VGMS's 1.67% return.

VCRM

• 1D: 0.12%
• 1M: 1.59%
• YTD: 2.39%
• 6M: 2.58%
• 1Y: 7.75%
• 3Y*: —
• 5Y*: —
• 10Y*: —

VGMS

• 1D: 0.20%
• 1M: 0.93%
• YTD: 1.67%
• 6M: 1.67%
• 1Y: 6.37%
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

VCRM vs. VGMS - Yearly Performance Comparison

	2026 (YTD)	2025
VCRM Vanguard Core Tax-Exempt Bond ETF	2.39%	5.95%
VGMS Vanguard Multi-Sector Income Bond ETF	1.67%	5.51%

Correlation

The correlation between VCRM and VGMS is 0.52, 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	0.52
Correlation (All Time) Calculated using the full available price history since Jun 11, 2025	0.51

The correlation between VCRM and VGMS has been stable across timeframes, ranging from 0.51 to 0.52 - a consistent structural relationship.

Return for Risk

VCRM vs. VGMS — Risk / Return Rank

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

VCRM

VCRM Risk / Return Rank: 80
VCRM Sharpe Ratio Rank: 88
VCRM Sortino Ratio Rank: 91
VCRM Omega Ratio Rank: 93
VCRM Calmar Ratio Rank: 65
VCRM Martin Ratio Rank: 65

VGMS

VGMS Risk / Return Rank: 69
VGMS Sharpe Ratio Rank: 68
VGMS Sortino Ratio Rank: 73
VGMS Omega Ratio Rank: 72
VGMS Calmar Ratio Rank: 59
VGMS Martin Ratio Rank: 72

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.

VCRM vs. VGMS - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Core Tax-Exempt Bond ETF (VCRM) and Vanguard Multi-Sector Income Bond ETF (VGMS). 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.

	VCRM	VGMS	Difference
Sharpe ratio: Return per unit of total volatility	2.59	1.97	+0.62
Sortino ratio: Return per unit of downside risk	3.83	2.93	+0.90
Omega ratio: Gain probability vs. loss probability	1.57	1.38	+0.19
Calmar ratio: Return relative to maximum drawdown	2.86	2.60	+0.26
Martin ratio: Return relative to average drawdown	10.60	11.76	-1.17

VCRM vs. VGMS - Sharpe Ratio Comparison

The current VCRM Sharpe Ratio is 2.59, which is higher than the VGMS Sharpe Ratio of 1.97. The chart below compares the historical Sharpe Ratios of VCRM and VGMS, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

VCRM vs. VGMS - Drawdown Comparison

The maximum VCRM drawdown since its inception was -4.12%, which is greater than VGMS's maximum drawdown of -2.46%. Use the drawdown chart below to compare losses from any high point for VCRM and VGMS.

Drawdown Indicators

	VCRM	VGMS	Difference
Max Drawdown Largest peak-to-trough decline	-4.12%	-2.46%	-1.66%
Max Drawdown (1Y) Largest decline over 1 year	-2.72%	-2.46%	-0.26%
Current Drawdown Current decline from peak	0.00%	0.00%	0.00%
Average Drawdown Average peak-to-trough decline	-1.09%	-0.30%	-0.79%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.73%	0.54%	+0.19%

Volatility

VCRM vs. VGMS - Volatility Comparison

The current volatility for Vanguard Core Tax-Exempt Bond ETF (VCRM) is 0.69%, while Vanguard Multi-Sector Income Bond ETF (VGMS) has a volatility of 1.07%. This indicates that VCRM experiences smaller price fluctuations and is considered to be less risky than VGMS based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VCRM	VGMS	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.69%	1.07%	-0.38%
Volatility (6M) Calculated over the trailing 6-month period	2.19%	2.64%	-0.45%
Volatility (1Y) Calculated over the trailing 1-year period	3.01%	3.26%	-0.25%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	3.83%	3.24%	+0.59%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	3.83%	3.24%	+0.59%

VCRM vs. VGMS - Expense Ratio Comparison

VCRM has a 0.12% expense ratio, which is lower than VGMS's 0.30% expense ratio.

Dividends

VCRM vs. VGMS - Dividend Comparison

VCRM's dividend yield for the trailing twelve months is around 3.62%, less than VGMS's 5.13% yield.

Position	TTM	2025	2024
VCRM Vanguard Core Tax-Exempt Bond ETF	3.62%	3.42%	0.40%
VGMS Vanguard Multi-Sector Income Bond ETF	5.13%	2.94%	0.00%

Frequently Asked Questions

Can I hold both VCRM and VGMS in my portfolio?

VCRM and VGMS have a correlation of 0.52, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VCRM or VGMS?

VGMS has higher volatility (1.07%) compared to VCRM (0.69%). In terms of maximum drawdown, VCRM dropped -4.12% vs VGMS's -2.46%.

Which ETF is better, VCRM or VGMS?

On 1-year performance, VCRM leads with 7.75% vs 6.37% for VGMS. On fees, VCRM is cheaper at 0.12% per year. On volatility, VCRM has been the lower-risk option at 0.69%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VCRM or VGMS?

Over the 1-year period, VCRM has performed better with a 7.75% return vs 6.37%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VCRM or VGMS?

VCRM is cheaper with a 0.12% expense ratio, compared with 0.30% for VGMS.

Which ETF pays a higher dividend yield, VCRM or VGMS?

VGMS has the higher dividend yield at 5.13%, compared with 3.62% for VCRM.

What is the main difference between VCRM and VGMS?

VCRM is categorized as Municipal Bonds, while VGMS is Multisector Bonds. Their fees differ too: 0.12% for VCRM and 0.30% for VGMS.

Which has better risk-adjusted returns?

VCRM currently has the higher Sharpe Ratio (2.59 vs 1.97), 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.