VTES vs. SUB

Last updated Jun 3, 2026

VTES (Vanguard Short-Term Tax-Exempt Bond ETF Shares) and SUB (iShares Short-Term National Muni Bond ETF) are both Municipal Bonds funds - VTES tracks the S&P 0-7 Yr National AMT-Free Municipal Bond Index - Benchmark TR Gross while SUB tracks the ICE Short Maturity AMT-Free US National Municipal Index - Benchmark TR Gross. Both are passively managed. Over the past 3 years, VTES returned 3.22%/yr vs 3.19%/yr for SUB. A 0.69 correlation means they provide meaningful diversification when combined. Both charge a 0.07% expense ratio.

Performance

VTES vs. SUB - 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 iShares Short-Term National Muni Bond ETF (SUB). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VTES achieves a 0.65% return, which is significantly lower than SUB's 0.78% return.

VTES

• 1D: 0.06%
• 1M: 0.28%
• YTD: 0.65%
• 6M: 1.08%
• 1Y: 3.72%
• 3Y*: 3.22%
• 5Y*: —
• 10Y*: —

SUB

• 1D: 0.07%
• 1M: 0.29%
• YTD: 0.78%
• 6M: 1.19%
• 1Y: 3.21%
• 3Y*: 3.19%
• 5Y*: 1.46%
• 10Y*: 1.49%

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

VTES vs. SUB - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023
VTES Vanguard Short-Term Tax-Exempt Bond ETF Shares	0.65%	4.19%	1.85%	3.32%
SUB iShares Short-Term National Muni Bond ETF	0.78%	3.64%	2.17%	3.12%

Correlation

The correlation between VTES and SUB is 0.58, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.58
Correlation (3Y) Calculated over the trailing 3-year period	0.67
Correlation (All Time) Calculated using the full available price history since Mar 10, 2023	0.69

The correlation between VTES and SUB shifts across timeframes, from 0.58 (1 year) to 0.69 (all time), reflecting how their relationship changes across market environments.

Return for Risk

VTES vs. SUB — Risk / Return Rank

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

VTES

VTES Risk / Return Rank: 74
VTES Sharpe Ratio Rank: 88
VTES Sortino Ratio Rank: 91
VTES Omega Ratio Rank: 95
VTES Calmar Ratio Rank: 51
VTES Martin Ratio Rank: 46

SUB

SUB Risk / Return Rank: 84
SUB Sharpe Ratio Rank: 91
SUB Sortino Ratio Rank: 93
SUB Omega Ratio Rank: 95
SUB Calmar Ratio Rank: 77
SUB Martin Ratio Rank: 62

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. SUB - 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 iShares Short-Term National Muni Bond ETF (SUB). 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	SUB	Difference
Sharpe ratio Return per unit of total volatility	3.01	3.23	-0.22
Sortino ratio Return per unit of downside risk	4.36	4.68	-0.32
Omega ratio Gain probability vs. loss probability	1.71	1.72	-0.01
Calmar ratio Return relative to maximum drawdown	2.54	3.96	-1.42
Martin ratio Return relative to average drawdown	7.58	11.24	-3.66
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. SUB - Sharpe Ratio Comparison

The current VTES Sharpe Ratio is 3.01, which is comparable to the SUB Sharpe Ratio of 3.23. The chart below compares the historical Sharpe Ratios of VTES and SUB, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	VTES	SUB	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	3.01	3.23	-0.22
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	—	0.89	—
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	—	0.57	—
Sharpe Ratio (All Time) Calculated using the full available price history	1.81	0.42	+1.39

Drawdowns

VTES vs. SUB - Drawdown Comparison

The maximum VTES drawdown since its inception was -2.42%, smaller than the maximum SUB drawdown of -9.46%. Use the drawdown chart below to compare losses from any high point for VTES and SUB.

Drawdown Indicators

	VTES	SUB	Difference
Max Drawdown Largest peak-to-trough decline	-2.42%	-9.46%	+7.04%
Max Drawdown (1Y) Largest decline over 1 year	-1.47%	-0.81%	-0.66%
Max Drawdown (3Y) Largest decline over 3 years	-1.80%	-1.23%	-0.57%
Max Drawdown (5Y) Largest decline over 5 years	—	-4.35%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-9.46%	—
Current Drawdown Current decline from peak	-0.63%	-0.12%	-0.51%
Average Drawdown Average peak-to-trough decline	-0.50%	-0.92%	+0.42%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.49%	0.28%	+0.21%

Volatility

VTES vs. SUB - Volatility Comparison

Vanguard Short-Term Tax-Exempt Bond ETF Shares (VTES) has a higher volatility of 0.35% compared to iShares Short-Term National Muni Bond ETF (SUB) at 0.28%. This indicates that VTES's price experiences larger fluctuations and is considered to be riskier than SUB based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VTES	SUB	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.35%	0.28%	+0.07%
Volatility (6M) Calculated over the trailing 6-month period	0.97%	0.79%	+0.18%
Volatility (1Y) Calculated over the trailing 1-year period	1.24%	1.00%	+0.24%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	1.72%	1.64%	+0.08%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	1.72%	2.60%	-0.88%

VTES vs. SUB - Expense Ratio Comparison

Both VTES and SUB have an expense ratio of 0.07%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.

Dividends

VTES vs. SUB - Dividend Comparison

VTES's dividend yield for the trailing twelve months is around 2.75%, more than SUB's 2.53% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
SUB iShares Short-Term National Muni Bond ETF	2.53%	2.42%	2.10%	1.73%	0.86%	0.72%	1.23%	1.58%	1.32%	0.95%	0.75%	0.77%
VTES Vanguard Short-Term Tax-Exempt Bond ETF Shares	2.75%	2.77%	2.99%	2.03%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both VTES and SUB in my portfolio?

VTES and SUB have a correlation of 0.58, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VTES or SUB?

VTES has higher volatility (0.35%) compared to SUB (0.28%). In terms of maximum drawdown, VTES dropped -2.42% vs SUB's -9.46%.

Which ETF is better, VTES or SUB?

On 3-year performance, VTES leads with 3.22% vs 3.19% for SUB. Both ETFs have the same 0.07% expense ratio. Their volatility is very similar. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, VTES or SUB?

Over the 3-year period, VTES has performed better with a 3.22% return vs 3.19%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, VTES or SUB?

VTES and SUB have the same expense ratio: 0.07% per year.

Which ETF pays a higher dividend yield, VTES or SUB?

VTES has the higher dividend yield at 2.75%, compared with 2.53% for SUB.

What is the main difference between VTES and SUB?

VTES tracks S&P 0-7 Yr National AMT-Free Municipal Bond Index - Benchmark TR Gross, while SUB tracks ICE Short Maturity AMT-Free US National Municipal Index - Benchmark TR Gross. They also come from different issuers: Vanguard and iShares.

Which has better risk-adjusted returns?

SUB currently has the higher Sharpe Ratio (3.23 vs 3.01), 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.