VTES vs. DFNM

Last updated Apr 1, 2026

Compare and contrast key facts about Vanguard Short-Term Tax-Exempt Bond ETF Shares (VTES) and Dimensional National Municipal Bond ETF (DFNM).

VTES and DFNM are both exchange-traded funds (ETFs), meaning they are traded on stock exchanges and can be bought and sold throughout the day. VTES is a passively managed fund by Vanguard that tracks the performance of the S&P 0-7 Yr National AMT-Free Municipal Bond Index - Benchmark TR Gross. It was launched on Mar 8, 2023. DFNM is an actively managed fund by Dimensional. It was launched on Nov 15, 2021.

Performance

VTES vs. DFNM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Short-Term Tax-Exempt Bond ETF Shares (VTES) and Dimensional National Municipal Bond ETF (DFNM). The values are adjusted to include any dividend payments, if applicable.

VTES vs. DFNM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023
VTES Vanguard Short-Term Tax-Exempt Bond ETF Shares	0.02%	4.19%	1.85%	3.32%
DFNM Dimensional National Municipal Bond ETF	0.08%	3.87%	1.19%	4.10%

Returns By Period

In the year-to-date period, VTES achieves a 0.02% return, which is significantly lower than DFNM's 0.08% return.

VTES

• 1D: 0.11%
• 1M: -1.24%
• YTD: 0.02%
• 6M: 0.60%
• 1Y: 3.45%
• 3Y*: 2.61%
• 5Y*: —
• 10Y*: —

DFNM

• 1D: 0.17%
• 1M: -1.55%
• YTD: 0.08%
• 6M: 1.40%
• 1Y: 3.80%
• 3Y*: 2.47%
• 5Y*: —
• 10Y*: —

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

VTES vs. DFNM - Expense Ratio Comparison

VTES has a 0.07% expense ratio, which is lower than DFNM's 0.17% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

DFNM

Dimensional National Municipal Bond ETF

VTES

Vanguard Short-Term Tax-Exempt Bond ETF Shares

Return for Risk

VTES vs. DFNM — Risk / Return Rank

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

VTES

VTES Risk / Return Rank: 87
VTES Sharpe Ratio Rank: 90
VTES Sortino Ratio Rank: 89
VTES Omega Ratio Rank: 96
VTES Calmar Ratio Rank: 83
VTES Martin Ratio Rank: 75

DFNM

DFNM Risk / Return Rank: 73
DFNM Sharpe Ratio Rank: 78
DFNM Sortino Ratio Rank: 73
DFNM Omega Ratio Rank: 87
DFNM Calmar Ratio Rank: 68
DFNM Martin Ratio Rank: 61

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.

VTES vs. DFNM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Short-Term Tax-Exempt Bond ETF Shares (VTES) and Dimensional National Municipal Bond ETF (DFNM). 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.

	VTES	DFNM	Difference
Sharpe ratio Return per unit of total volatility	1.91	1.46	+0.44
Sortino ratio Return per unit of downside risk	2.43	1.85	+0.58
Omega ratio Gain probability vs. loss probability	1.49	1.35	+0.14
Calmar ratio Return relative to maximum drawdown	2.30	1.72	+0.58
Martin ratio Return relative to average drawdown	7.44	6.02	+1.42
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VTES vs. DFNM - Sharpe Ratio Comparison

The current VTES Sharpe Ratio is 1.91, which is higher than the DFNM Sharpe Ratio of 1.46. The chart below compares the historical Sharpe Ratios of VTES and DFNM, offering insights into how both investments have performed under varying market conditions. These values are calculated using daily returns over the previous 12 months.

Sharpe Ratios by Period

	VTES	DFNM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.91	1.46	+0.44
Sharpe Ratio (All Time) Calculated using the full available price history	1.76	0.48	+1.28

Correlation

The correlation between VTES and DFNM is 0.72, which is considered to be high. That indicates a strong positive relationship between their price movements. Having highly-correlated positions in a portfolio may signal a lack of diversification, potentially leading to increased risk during market downturns.

Dividends

VTES vs. DFNM - Dividend Comparison

VTES's dividend yield for the trailing twelve months is around 2.77%, less than DFNM's 2.97% yield.

	TTM	2025	2024	2023	2022	2021
VTES Vanguard Short-Term Tax-Exempt Bond ETF Shares	2.77%	2.77%	2.99%	2.03%	0.00%	0.00%
DFNM Dimensional National Municipal Bond ETF	2.97%	2.94%	2.74%	2.39%	1.16%	0.05%

Drawdowns

VTES vs. DFNM - Drawdown Comparison

The maximum VTES drawdown since its inception was -2.42%, smaller than the maximum DFNM drawdown of -6.99%. Use the drawdown chart below to compare losses from any high point for VTES and DFNM.

Drawdown Indicators

	VTES	DFNM	Difference
Max Drawdown Largest peak-to-trough decline	-2.42%	-6.99%	+4.57%
Max Drawdown (1Y) Largest decline over 1 year	-1.59%	-2.34%	+0.75%
Current Drawdown Current decline from peak	-1.24%	-1.55%	+0.31%
Average Drawdown Average peak-to-trough decline	-0.48%	-2.01%	+1.53%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.49%	0.67%	-0.18%

Volatility

VTES vs. DFNM - Volatility Comparison

The current volatility for Vanguard Short-Term Tax-Exempt Bond ETF Shares (VTES) is 0.69%, while Dimensional National Municipal Bond ETF (DFNM) has a volatility of 0.86%. This indicates that VTES experiences smaller price fluctuations and is considered to be less risky than DFNM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VTES	DFNM	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.69%	0.86%	-0.17%
Volatility (6M) Calculated over the trailing 6-month period	0.96%	1.22%	-0.26%
Volatility (1Y) Calculated over the trailing 1-year period	1.83%	2.62%	-0.79%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	1.75%	2.57%	-0.82%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	1.75%	2.57%	-0.82%