VTEL vs. VTEB

Last updated Jun 24, 2026

VTEL (Vanguard Long-Term Tax-Exempt Bond ETF) and VTEB (Vanguard Tax-Exempt Bond ETF) are both Municipal Bonds funds from Vanguard - VTEL tracks the S&P 10+ Year National AMT-Free Municipal Bond Index while VTEB tracks the S&P National AMT-Free Municipal Bond Index. Both are passively managed. Over the past year, VTEL returned 8.23% vs 6.65% for VTEB. Their correlation of 0.88 suggests significant overlap in exposure. VTEL charges 0.09%/yr vs 0.03%/yr for VTEB.

Performance

VTEL vs. VTEB - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Long-Term Tax-Exempt Bond ETF (VTEL) and Vanguard Tax-Exempt Bond ETF (VTEB). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VTEL achieves a 2.14% return, which is significantly higher than VTEB's 1.70% return.

VTEL

• 1D: -0.07%
• 1M: 1.82%
• YTD: 2.14%
• 6M: 2.27%
• 1Y: 8.23%
• 3Y*: —
• 5Y*: —
• 10Y*: —

VTEB

• 1D: -0.02%
• 1M: 1.38%
• YTD: 1.70%
• 6M: 1.88%
• 1Y: 6.65%
• 3Y*: 3.38%
• 5Y*: 0.95%
• 10Y*: 1.97%

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

VTEL vs. VTEB - Yearly Performance Comparison

	2026 (YTD)	2025
VTEL Vanguard Long-Term Tax-Exempt Bond ETF	2.14%	6.61%
VTEB Vanguard Tax-Exempt Bond ETF	1.70%	5.55%

Correlation

The correlation between VTEL and VTEB is 0.88, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.88
Correlation (All Time) Calculated using the full available price history since May 22, 2025	0.88

The correlation between VTEL and VTEB has been stable across timeframes, ranging from 0.88 to 0.88 - a consistent structural relationship.

Return for Risk

VTEL vs. VTEB — Risk / Return Rank

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

VTEL

VTEL Risk / Return Rank: 71
VTEL Sharpe Ratio Rank: 76
VTEL Sortino Ratio Rank: 82
VTEL Omega Ratio Rank: 84
VTEL Calmar Ratio Rank: 56
VTEL Martin Ratio Rank: 56

VTEB

VTEB Risk / Return Rank: 72
VTEB Sharpe Ratio Rank: 81
VTEB Sortino Ratio Rank: 86
VTEB Omega Ratio Rank: 89
VTEB Calmar Ratio Rank: 51
VTEB Martin Ratio Rank: 52

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.

VTEL vs. VTEB - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Long-Term Tax-Exempt Bond ETF (VTEL) and Vanguard Tax-Exempt Bond ETF (VTEB). 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.

	VTEL	VTEB	Difference
Sharpe ratio: Return per unit of total volatility	2.23	2.49	-0.27
Sortino ratio: Return per unit of downside risk	3.36	3.69	-0.34
Omega ratio: Gain probability vs. loss probability	1.46	1.54	-0.08
Calmar ratio: Return relative to maximum drawdown	2.56	2.47	+0.10
Martin ratio: Return relative to average drawdown	9.14	8.69	+0.45

VTEL vs. VTEB - Sharpe Ratio Comparison

The current VTEL Sharpe Ratio is 2.23, which is comparable to the VTEB Sharpe Ratio of 2.49. The chart below compares the historical Sharpe Ratios of VTEL and VTEB, 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

VTEL vs. VTEB - Drawdown Comparison

The maximum VTEL drawdown since its inception was -3.22%, smaller than the maximum VTEB drawdown of -17.00%. Use the drawdown chart below to compare losses from any high point for VTEL and VTEB.

Drawdown Indicators

	VTEL	VTEB	Difference
Max Drawdown Largest peak-to-trough decline	-3.22%	-17.00%	+13.78%
Max Drawdown (1Y) Largest decline over 1 year	-3.22%	-2.71%	-0.51%
Max Drawdown (3Y) Largest decline over 3 years	—	-5.53%	—
Max Drawdown (5Y) Largest decline over 5 years	—	-12.64%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-17.00%	—
Current Drawdown Current decline from peak	-0.12%	-0.28%	+0.16%
Average Drawdown Average peak-to-trough decline	-0.57%	-2.32%	+1.75%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.90%	0.77%	+0.13%

Volatility

VTEL vs. VTEB - Volatility Comparison

Vanguard Long-Term Tax-Exempt Bond ETF (VTEL) has a higher volatility of 0.98% compared to Vanguard Tax-Exempt Bond ETF (VTEB) at 0.72%. This indicates that VTEL's price experiences larger fluctuations and is considered to be riskier than VTEB based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VTEL	VTEB	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.98%	0.72%	+0.26%
Volatility (6M) Calculated over the trailing 6-month period	2.67%	2.06%	+0.61%
Volatility (1Y) Calculated over the trailing 1-year period	3.71%	2.68%	+1.03%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	3.73%	3.90%	-0.17%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	3.73%	5.25%	-1.52%

VTEL vs. VTEB - Expense Ratio Comparison

VTEL has a 0.09% expense ratio, which is higher than VTEB'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

VTEL vs. VTEB - Dividend Comparison

VTEL's dividend yield for the trailing twelve months is around 3.80%, more than VTEB's 3.35% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VTEB Vanguard Tax-Exempt Bond ETF	3.35%	3.29%	3.14%	2.79%	2.09%	1.64%	1.99%	2.30%	2.25%	1.96%	1.66%	0.58%
VTEL Vanguard Long-Term Tax-Exempt Bond ETF	3.80%	2.23%	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 VTEL and VTEB in my portfolio?

VTEL and VTEB have a correlation of 0.88, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VTEL or VTEB?

VTEL has higher volatility (0.98%) compared to VTEB (0.72%). In terms of maximum drawdown, VTEL dropped -3.22% vs VTEB's -17.00%.

Which ETF is better, VTEL or VTEB?

On 1-year performance, VTEL leads with 8.23% vs 6.65% for VTEB. On fees, VTEB is cheaper at 0.03% per year. On volatility, VTEB has been the lower-risk option at 0.72%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VTEL or VTEB?

Over the 1-year period, VTEL has performed better with a 8.23% return vs 6.65%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VTEL or VTEB?

VTEB is cheaper with a 0.03% expense ratio, compared with 0.09% for VTEL.

Which ETF pays a higher dividend yield, VTEL or VTEB?

VTEL has the higher dividend yield at 3.80%, compared with 3.35% for VTEB.

What is the main difference between VTEL and VTEB?

VTEL tracks S&P 10+ Year National AMT-Free Municipal Bond Index, while VTEB tracks S&P National AMT-Free Municipal Bond Index. Their fees differ too: 0.09% for VTEL and 0.03% for VTEB.

Which has better risk-adjusted returns?

VTEB currently has the higher Sharpe Ratio (2.49 vs 2.23), 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.