VSDB vs. TAXS

Last updated Jun 23, 2026

VSDB (Vanguard Short Duration Bond ETF Shares) and TAXS (Northern Trust Short-Term Tax-Exempt Bond ETF) are both exchange-traded funds - VSDB is a Short-Term Bond fund actively managed by Vanguard, while TAXS is a Municipal Bonds fund tracking the ICE Short Term Focused Municipal Bond Index. VSDB is actively managed, while TAXS is passively managed. A 0.57 correlation means they provide meaningful diversification when combined. VSDB charges 0.15%/yr vs 0.05%/yr for TAXS.

Performance

VSDB vs. TAXS - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Short Duration Bond ETF Shares (VSDB) and Northern Trust Short-Term Tax-Exempt Bond ETF (TAXS). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VSDB achieves a 0.95% return, which is significantly lower than TAXS's 1.05% return.

VSDB

• 1D: -0.11%
• 1M: 0.30%
• YTD: 0.95%
• 6M: 1.15%
• 1Y: 4.75%
• 3Y*: —
• 5Y*: —
• 10Y*: —

TAXS

• 1D: -0.01%
• 1M: 0.64%
• YTD: 1.05%
• 6M: 1.28%
• 1Y: —
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

VSDB vs. TAXS - Yearly Performance Comparison

	2026 (YTD)	2025
VSDB Vanguard Short Duration Bond ETF Shares	0.95%	2.29%
TAXS Northern Trust Short-Term Tax-Exempt Bond ETF	1.05%	1.22%

Correlation

The correlation between VSDB and TAXS is 0.57, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (All Time) Calculated using the full available price history since Aug 19, 2025	0.57

Return for Risk

VSDB vs. TAXS — Risk / Return Rank

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

VSDB

VSDB Risk / Return Rank: 83
VSDB Sharpe Ratio Rank: 88
VSDB Sortino Ratio Rank: 92
VSDB Omega Ratio Rank: 91
VSDB Calmar Ratio Rank: 69
VSDB Martin Ratio Rank: 78

TAXS

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

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.

VSDB vs. TAXS - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Short Duration Bond ETF Shares (VSDB) and Northern Trust Short-Term Tax-Exempt Bond ETF (TAXS). 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.

	VSDB	TAXS	Difference
Sharpe ratio: Return per unit of total volatility	2.74	—	—
Sortino ratio: Return per unit of downside risk	4.25	—	—
Omega ratio: Gain probability vs. loss probability	1.56	—	—
Calmar ratio: Return relative to maximum drawdown	3.35	—	—
Martin ratio: Return relative to average drawdown	14.67	—	—

Drawdowns

VSDB vs. TAXS - Drawdown Comparison

The maximum VSDB drawdown since its inception was -1.42%, which is greater than TAXS's maximum drawdown of -0.84%. Use the drawdown chart below to compare losses from any high point for VSDB and TAXS.

Drawdown Indicators

	VSDB	TAXS	Difference
Max Drawdown Largest peak-to-trough decline	-1.42%	-0.84%	-0.58%
Max Drawdown (1Y) Largest decline over 1 year	-1.42%	—	—
Current Drawdown Current decline from peak	-0.26%	-0.02%	-0.24%
Average Drawdown Average peak-to-trough decline	-0.19%	-0.22%	+0.03%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.32%	—	—

Volatility

Volatility by Period

	VSDB	TAXS	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.52%	—	—
Volatility (6M) Calculated over the trailing 6-month period	1.39%	—	—
Volatility (1Y) Calculated over the trailing 1-year period	1.75%	0.99%	+0.76%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	1.90%	0.99%	+0.91%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	1.90%	0.99%	+0.91%

VSDB vs. TAXS - Expense Ratio Comparison

VSDB has a 0.15% expense ratio, which is higher than TAXS's 0.05% 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

VSDB vs. TAXS - Dividend Comparison

VSDB's dividend yield for the trailing twelve months is around 4.16%, more than TAXS's 1.82% yield.

Position	TTM	2025
TAXS Northern Trust Short-Term Tax-Exempt Bond ETF	1.82%	0.74%
VSDB Vanguard Short Duration Bond ETF Shares	4.16%	3.30%

Frequently Asked Questions

Can I hold both VSDB and TAXS in my portfolio?

VSDB and TAXS have a correlation of 0.57, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which ETF is better, VSDB or TAXS?

On fees, TAXS is cheaper at 0.05% per year. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF is cheaper, VSDB or TAXS?

TAXS is cheaper with a 0.05% expense ratio, compared with 0.15% for VSDB.

Which ETF pays a higher dividend yield, VSDB or TAXS?

VSDB has the higher dividend yield at 4.16%, compared with 1.82% for TAXS.

What is the main difference between VSDB and TAXS?

VSDB is categorized as Short-Term Bond, while TAXS is Municipal Bonds. They also come from different issuers: Vanguard and Northern Trust. Their fees differ too: 0.15% for VSDB and 0.05% for TAXS.