VTEB vs. IBHI
VTEB (Vanguard Tax-Exempt Bond ETF) and IBHI (iShares iBonds 2029 Term High Yield and Income ETF) are both exchange-traded funds - VTEB is a Municipal Bonds fund tracking the S&P National AMT-Free Municipal Bond Index, while IBHI is a High Yield Bonds fund tracking the Bloomberg 2029 Term High Yield and Income Index - Benchmark TR Gross. Both are passively managed. Over the past 3 years, VTEB returned 3.44%/yr vs 8.77%/yr for IBHI. At a 0.45 correlation, their price movements are largely independent. VTEB charges 0.03%/yr vs 0.35%/yr for IBHI.
Performance
VTEB vs. IBHI - Performance Comparison
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Returns By Period
The year-to-date returns for both investments are quite close, with VTEB having a 1.44% return and IBHI slightly higher at 1.47%.
VTEB
- 1D
- -0.08%
- 1M
- 1.22%
- YTD
- 1.44%
- 6M
- 1.95%
- 1Y
- 6.57%
- 3Y*
- 3.44%
- 5Y*
- 0.80%
- 10Y*
- 2.03%
IBHI
- 1D
- 0.13%
- 1M
- 0.67%
- YTD
- 1.47%
- 6M
- 2.17%
- 1Y
- 6.95%
- 3Y*
- 8.77%
- 5Y*
- —
- 10Y*
- —
VTEB vs. IBHI - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | |
|---|---|---|---|---|---|
VTEB Vanguard Tax-Exempt Bond ETF | 1.44% | 3.72% | 1.31% | 6.15% | -4.39% |
IBHI iShares iBonds 2029 Term High Yield and Income ETF | 1.47% | 7.88% | 8.33% | 14.21% | -8.52% |
Correlation
The correlation between VTEB and IBHI is 0.40, which is low. Their price movements are largely independent, making them effective diversification partners.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.40 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.45 |
Correlation (All Time) Calculated using the full available price history since Mar 10, 2022 | 0.45 |
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Return for Risk
VTEB vs. IBHI — Risk / Return Rank
VTEB
IBHI
VTEB vs. IBHI - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for Vanguard Tax-Exempt Bond ETF (VTEB) and iShares iBonds 2029 Term High Yield and Income ETF (IBHI). 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.
| VTEB | IBHI | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.60 | ||
| Sortino ratioReturn per unit of downside risk | +0.76 | ||
| Omega ratioGain probability vs. loss probability | 1.51 | 1.33 | +0.18 |
| Calmar ratioReturn relative to maximum drawdown | 2.35 | 3.22 | -0.87 |
| Martin ratioReturn relative to average drawdown | 8.30 | 14.06 | -5.76 |
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Drawdowns
VTEB vs. IBHI - Drawdown Comparison
The maximum VTEB drawdown since its inception was -17.00%, which is greater than IBHI's maximum drawdown of -13.65%. Use the drawdown chart below to compare losses from any high point for VTEB and IBHI.
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Drawdown Indicators
| VTEB | IBHI | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -17.00% | -13.65% | -3.35% |
Max Drawdown (1Y)Largest decline over 1 year | -2.71% | -2.11% | -0.60% |
Max Drawdown (3Y)Largest decline over 3 years | -5.53% | -5.73% | +0.20% |
Max Drawdown (5Y)Largest decline over 5 years | -12.64% | — | — |
Max Drawdown (10Y)Largest decline over 10 years | -17.00% | — | — |
Current DrawdownCurrent decline from peak | -0.54% | -0.21% | -0.33% |
Average DrawdownAverage peak-to-trough decline | -2.32% | -2.83% | +0.51% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.77% | 0.48% | +0.29% |
Volatility
VTEB vs. IBHI - Volatility Comparison
Vanguard Tax-Exempt Bond ETF (VTEB) and iShares iBonds 2029 Term High Yield and Income ETF (IBHI) have volatilities of 0.93% and 0.97%, 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
| VTEB | IBHI | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 0.93% | 0.97% | -0.04% |
Volatility (6M)Calculated over the trailing 6-month period | 2.04% | 2.79% | -0.75% |
Volatility (1Y)Calculated over the trailing 1-year period | 2.70% | 3.82% | -1.12% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 3.90% | 7.96% | -4.06% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 5.26% | 7.96% | -2.70% |
VTEB vs. IBHI - Expense Ratio Comparison
VTEB has a 0.03% expense ratio, which is lower than IBHI's 0.35% expense ratio.
Dividends
VTEB vs. IBHI - Dividend Comparison
VTEB's dividend yield for the trailing twelve months is around 3.36%, less than IBHI's 6.70% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IBHI iShares iBonds 2029 Term High Yield and Income ETF | 6.70% | 6.79% | 6.66% | 6.48% | 5.26% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
VTEB Vanguard Tax-Exempt Bond ETF | 3.36% | 3.29% | 3.14% | 2.79% | 2.09% | 1.64% | 1.99% | 2.30% | 2.25% | 1.96% | 1.66% | 0.58% |
Frequently Asked Questions
VTEB and IBHI have a correlation of 0.40, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
IBHI has higher volatility (0.97%) compared to VTEB (0.93%). In terms of maximum drawdown, VTEB dropped -17.00% vs IBHI's -13.65%.
On 3-year performance, IBHI leads with 8.77% vs 3.44% for VTEB. On fees, VTEB 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 3-year period, IBHI has performed better with a 8.77% return vs 3.44%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
VTEB is cheaper with a 0.03% expense ratio, compared with 0.35% for IBHI.
IBHI has the higher dividend yield at 6.70%, compared with 3.36% for VTEB.
VTEB is categorized as Municipal Bonds, while IBHI is High Yield Bonds. VTEB tracks S&P National AMT-Free Municipal Bond Index, while IBHI tracks Bloomberg 2029 Term High Yield and Income Index - Benchmark TR Gross. They also come from different issuers: Vanguard and iShares. Their fees differ too: 0.03% for VTEB and 0.35% for IBHI.
VTEB currently has the higher Sharpe Ratio (2.38 vs 1.78), 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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