VGUS vs. VGSH

Last updated Jun 23, 2026

VGUS (Vanguard Ultra-Short Treasury ETF) and VGSH (Vanguard Short-Term Treasury ETF) are both exchange-traded funds - VGUS is a Ultrashort Bond fund tracking the Bloomberg Short Treasury Index, while VGSH is a Government Bonds fund tracking the Bloomberg U.S. Treasury 1-3 Year Index. Both are passively managed. Over the past year, VGUS returned 3.86% vs 3.04% for VGSH. At a 0.26 correlation, their price movements are largely independent. VGUS charges 0.07%/yr vs 0.03%/yr for VGSH.

Performance

VGUS vs. VGSH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Ultra-Short Treasury ETF (VGUS) and Vanguard Short-Term Treasury ETF (VGSH). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VGUS achieves a 1.59% return, which is significantly higher than VGSH's 0.41% return.

VGUS

• 1D: 0.01%
• 1M: 0.18%
• YTD: 1.59%
• 6M: 1.69%
• 1Y: 3.86%
• 3Y*: —
• 5Y*: —
• 10Y*: —

VGSH

• 1D: -0.09%
• 1M: 0.06%
• YTD: 0.41%
• 6M: 0.53%
• 1Y: 3.04%
• 3Y*: 4.18%
• 5Y*: 1.84%
• 10Y*: 1.70%

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

VGUS vs. VGSH - Yearly Performance Comparison

	2026 (YTD)	2025
VGUS Vanguard Ultra-Short Treasury ETF	1.59%	3.78%
VGSH Vanguard Short-Term Treasury ETF	0.41%	4.70%

Correlation

The correlation between VGUS and VGSH is 0.23, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.23
Correlation (All Time) Calculated using the full available price history since Feb 11, 2025	0.26

Return for Risk

VGUS vs. VGSH — Risk / Return Rank

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

VGUS

VGUS Risk / Return Rank: 99
VGUS Sharpe Ratio Rank: 100
VGUS Sortino Ratio Rank: 99
VGUS Omega Ratio Rank: 99
VGUS Calmar Ratio Rank: 99
VGUS Martin Ratio Rank: 100

VGSH

VGSH Risk / Return Rank: 78
VGSH Sharpe Ratio Rank: 76
VGSH Sortino Ratio Rank: 86
VGSH Omega Ratio Rank: 84
VGSH Calmar Ratio Rank: 71
VGSH Martin Ratio Rank: 73

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.

VGUS vs. VGSH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Ultra-Short Treasury ETF (VGUS) and Vanguard Short-Term Treasury ETF (VGSH). 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.

	VGUS	VGSH	Difference
Sharpe ratio: Return per unit of total volatility	11.86	2.33	+9.53
Sortino ratio: Return per unit of downside risk	34.14	3.69	+30.44
Omega ratio: Gain probability vs. loss probability	10.51	1.49	+9.02
Calmar ratio: Return relative to maximum drawdown	53.22	3.46	+49.77
Martin ratio: Return relative to average drawdown	402.91	13.29	+389.61

VGUS vs. VGSH - Sharpe Ratio Comparison

The current VGUS Sharpe Ratio is 11.86, which is higher than the VGSH Sharpe Ratio of 2.33. The chart below compares the historical Sharpe Ratios of VGUS and VGSH, 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

VGUS vs. VGSH - Drawdown Comparison

The maximum VGUS drawdown since its inception was -0.07%, smaller than the maximum VGSH drawdown of -5.70%. Use the drawdown chart below to compare losses from any high point for VGUS and VGSH.

Drawdown Indicators

	VGUS	VGSH	Difference
Max Drawdown Largest peak-to-trough decline	-0.07%	-5.70%	+5.63%
Max Drawdown (1Y) Largest decline over 1 year	-0.07%	-0.88%	+0.81%
Max Drawdown (3Y) Largest decline over 3 years	—	-0.97%	—
Max Drawdown (5Y) Largest decline over 5 years	—	-5.66%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-5.70%	—
Current Drawdown Current decline from peak	0.00%	-0.36%	+0.36%
Average Drawdown Average peak-to-trough decline	-0.00%	-0.60%	+0.60%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.01%	0.23%	-0.22%

Volatility

VGUS vs. VGSH - Volatility Comparison

The current volatility for Vanguard Ultra-Short Treasury ETF (VGUS) is 0.12%, while Vanguard Short-Term Treasury ETF (VGSH) has a volatility of 0.45%. This indicates that VGUS experiences smaller price fluctuations and is considered to be less risky than VGSH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VGUS	VGSH	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.12%	0.45%	-0.33%
Volatility (6M) Calculated over the trailing 6-month period	0.18%	0.96%	-0.78%
Volatility (1Y) Calculated over the trailing 1-year period	0.33%	1.31%	-0.98%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	0.34%	1.97%	-1.63%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	0.34%	1.58%	-1.24%

VGUS vs. VGSH - Expense Ratio Comparison

VGUS has a 0.07% expense ratio, which is higher than VGSH's 0.03% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VGUS vs. VGSH - Dividend Comparison

VGUS's dividend yield for the trailing twelve months is around 3.60%, less than VGSH's 3.88% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VGSH Vanguard Short-Term Treasury ETF	3.88%	4.00%	4.18%	3.31%	1.15%	0.66%	1.74%	2.28%	1.79%	1.10%	0.84%	0.69%
VGUS Vanguard Ultra-Short Treasury ETF	3.60%	3.12%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both VGUS and VGSH in my portfolio?

VGUS and VGSH have a correlation of 0.23, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VGUS or VGSH?

VGSH has higher volatility (0.45%) compared to VGUS (0.12%). In terms of maximum drawdown, VGUS dropped -0.07% vs VGSH's -5.70%.

Which ETF is better, VGUS or VGSH?

On 1-year performance, VGUS leads with 3.86% vs 3.04% for VGSH. On fees, VGSH is cheaper at 0.03% per year. On volatility, VGUS has been the lower-risk option at 0.12%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VGUS or VGSH?

Over the 1-year period, VGUS has performed better with a 3.86% return vs 3.04%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VGUS or VGSH?

VGSH is cheaper with a 0.03% expense ratio, compared with 0.07% for VGUS.

Which ETF pays a higher dividend yield, VGUS or VGSH?

VGSH has the higher dividend yield at 3.88%, compared with 3.60% for VGUS.

What is the main difference between VGUS and VGSH?

VGUS is categorized as Ultrashort Bond, while VGSH is Government Bonds. VGUS tracks Bloomberg Short Treasury Index, while VGSH tracks Bloomberg U.S. Treasury 1-3 Year Index. Their fees differ too: 0.07% for VGUS and 0.03% for VGSH.

Which has better risk-adjusted returns?

VGUS currently has the higher Sharpe Ratio (11.86 vs 2.33), 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.