VMFXX vs. BSV

Last updated Jul 25, 2026

VMFXX (Vanguard Federal Money Market Fund) and BSV (Vanguard Short-Term Bond Index Fund ETF Shares) are both funds - VMFXX is a Money Market fund managed by Vanguard, while BSV is a Short-Term Bond fund tracking the Bloomberg U.S. 1–5 Year Government/Credit Float Adjusted Index. Over the past 5 years, VMFXX returned 3.08%/yr vs 1.60%/yr for BSV. At a 0.09 correlation, their price movements are largely independent. VMFXX charges 0.11%/yr vs 0.03%/yr for BSV.

Performance

VMFXX vs. BSV - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Federal Money Market Fund (VMFXX) and Vanguard Short-Term Bond Index Fund ETF Shares (BSV). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VMFXX achieves a 1.80% return, which is significantly higher than BSV's 0.28% return.

VMFXX

• 1D: 0.00%
• 1M: 0.29%
• 6M: 1.80%
• YTD: 1.80%
• 1Y: 3.90%
• 3Y*: 4.37%
• 5Y*: 3.08%
• 10Y*: —
• ALL TIME*: 2.98%

BSV

• 1D: 0.09%
• 1M: -0.18%
• 6M: 0.30%
• YTD: 0.28%
• 1Y: 2.88%
• 3Y*: 4.49%
• 5Y*: 1.60%
• 10Y*: 1.90%
• ALL TIME*: 2.51%

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

Liquidity Comparison

Position	Avg. Volume Value (2W)	Avg. Volume Value (1M)	Avg. Volume Value (3M)
BSV Vanguard Short-Term Bond Index Fund ETF Shares	$202.09M	$205.14M	$203.39M
VMFXX Vanguard Federal Money Market Fund	$0.00	$0.00	$0.00

VMFXX vs. BSV - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021
VMFXX Vanguard Federal Money Market Fund	1.80%	4.24%	4.83%	4.64%	0.00%	0.00%
BSV Vanguard Short-Term Bond Index Fund ETF Shares	0.28%	6.00%	3.78%	4.90%	-5.49%	-0.87%

Correlation

The correlation between VMFXX and BSV is 0.06, 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	0.06
Correlation (3Y) Calculated over the trailing 3-year period	0.07
Correlation (5Y) Calculated over the trailing 5-year period	0.09
Correlation (All Time) Calculated using the full available price history since May 25, 2021	0.09

Return for Risk

VMFXX vs. BSV — Risk / Return Rank

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

VMFXX

Risk / return metrics aren't available yet — we need at least 12 months of trading data to calculate them.

BSV

BSV Risk / Return Rank: 68
BSV Sharpe Ratio Rank: 70
BSV Sortino Ratio Rank: 77
BSV Omega Ratio Rank: 71
BSV Calmar Ratio Rank: 64
BSV Martin Ratio Rank: 59

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.

VMFXX vs. BSV - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Federal Money Market Fund (VMFXX) and Vanguard Short-Term Bond Index Fund ETF Shares (BSV). 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.

	VMFXX	BSV	Difference
Sharpe ratio: Return per unit of total volatility	3.67	1.59	+2.08
Sortino ratio: Return per unit of downside risk	—	2.47	—
Omega ratio: Gain probability vs. loss probability	—	1.30	—
Calmar ratio: Return relative to maximum drawdown	—	2.24	—
Martin ratio: Return relative to average drawdown	—	7.05	—

VMFXX vs. BSV - Sharpe Ratio Comparison

The current VMFXX Sharpe Ratio is 3.67, which is higher than the BSV Sharpe Ratio of 1.59. The chart below compares the historical Sharpe Ratios of VMFXX and BSV, 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

VMFXX vs. BSV - Drawdown Comparison

The maximum VMFXX drawdown since its inception was 0.00%, smaller than the maximum BSV drawdown of -8.54%. Use the drawdown chart below to compare losses from any high point for VMFXX and BSV.

Drawdown Indicators

	VMFXX	BSV	Difference
Max Drawdown Largest peak-to-trough decline	0.00%	-8.54%	+8.54%
Max Drawdown (1Y) Largest decline over 1 year	0.00%	-1.29%	+1.29%
Max Drawdown (3Y) Largest decline over 3 years	0.00%	-1.53%	+1.53%
Max Drawdown (5Y) Largest decline over 5 years	0.00%	-8.54%	+8.54%
Max Drawdown (10Y) Largest decline over 10 years	—	-8.54%	—
Current Drawdown Current decline from peak	0.00%	-0.64%	+0.64%
Average Drawdown Average peak-to-trough decline	0.00%	-0.97%	+0.97%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.00%	0.41%	-0.41%

Volatility

VMFXX vs. BSV - Volatility Comparison

The current volatility for Vanguard Federal Money Market Fund (VMFXX) is 0.29%, while Vanguard Short-Term Bond Index Fund ETF Shares (BSV) has a volatility of 0.51%. This indicates that VMFXX experiences smaller price fluctuations and is considered to be less risky than BSV based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VMFXX	BSV	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.29%	0.51%	-0.22%
Volatility (6M) Calculated over the trailing 6-month period	0.71%	1.41%	-0.70%
Volatility (1Y) Calculated over the trailing 1-year period	1.10%	1.82%	-0.72%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	1.08%	2.74%	-1.66%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	1.07%	2.38%	-1.31%

VMFXX vs. BSV - Expense Ratio Comparison

VMFXX has a 0.11% expense ratio, which is higher than BSV'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

VMFXX vs. BSV - Dividend Comparison

VMFXX's dividend yield for the trailing twelve months is around 3.82%, less than BSV's 4.02% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
BSV Vanguard Short-Term Bond Index Fund ETF Shares	4.02%	3.83%	3.38%	2.46%	1.50%	1.45%	1.79%	2.29%	1.99%	1.65%	1.48%	1.40%
VMFXX Vanguard Federal Money Market Fund	3.82%	4.14%	4.70%	4.53%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both VMFXX and BSV in my portfolio?

VMFXX and BSV have a correlation of 0.06, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VMFXX or BSV?

BSV has higher volatility (0.51%) compared to VMFXX (0.29%). In terms of maximum drawdown, VMFXX dropped 0.00% vs BSV's -8.54%.

Which has better risk-adjusted returns?

VMFXX currently has the higher Sharpe Ratio (3.67 vs 1.59), 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.