VTTHX vs. VMLTX

Last updated Jun 5, 2026

VTTHX (Vanguard Target Retirement 2035 Fund) and VMLTX (Vanguard Limited-Term Tax-Exempt Fund Investor Shares) are both mutual funds - VTTHX is a Target Retirement Date fund managed by Vanguard, while VMLTX is a Municipal Bonds fund managed by Vanguard. Over the past 10 years, VTTHX returned 9.72%/yr vs 2.13%/yr for VMLTX. At a correlation of -0.02, they often move in opposite directions. VTTHX charges 0.08%/yr vs 0.17%/yr for VMLTX.

Performance

VTTHX vs. VMLTX - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Target Retirement 2035 Fund (VTTHX) and Vanguard Limited-Term Tax-Exempt Fund Investor Shares (VMLTX). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VTTHX achieves a 8.47% return, which is significantly higher than VMLTX's 1.01% return. Over the past 10 years, VTTHX has outperformed VMLTX with an annualized return of 9.72%, while VMLTX has yielded a comparatively lower 2.13% annualized return.

VTTHX

• 1D: -0.60%
• 1M: 2.70%
• YTD: 8.47%
• 6M: 9.05%
• 1Y: 20.81%
• 3Y*: 15.64%
• 5Y*: 7.69%
• 10Y*: 9.72%

VMLTX

• 1D: 0.00%
• 1M: 0.35%
• YTD: 1.01%
• 6M: 1.37%
• 1Y: 4.26%
• 3Y*: 4.24%
• 5Y*: 2.12%
• 10Y*: 2.13%

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

VTTHX vs. VMLTX - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
VTTHX Vanguard Target Retirement 2035 Fund	8.47%	17.55%	11.56%	17.37%	-16.64%	12.96%	14.80%	22.44%	-6.57%	16.81%
VMLTX Vanguard Limited-Term Tax-Exempt Fund Investor Shares	1.01%	5.39%	3.14%	4.19%	-2.98%	0.83%	3.30%	4.11%	1.56%	2.02%

Correlation

The correlation between VTTHX and VMLTX is 0.19, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.19
Correlation (3Y) Calculated over the trailing 3-year period	0.18
Correlation (5Y) Calculated over the trailing 5-year period	0.16
Correlation (10Y) Calculated over the trailing 10-year period	0.08
Correlation (All Time) Calculated using the full available price history since Oct 28, 2003	-0.02

The correlation between VTTHX and VMLTX shifts across timeframes, from -0.02 (all time) to 0.19 (1 year), reflecting how their relationship changes across market environments.

Return for Risk

VTTHX vs. VMLTX — Risk / Return Rank

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

VTTHX

VTTHX Risk / Return Rank: 64
VTTHX Sharpe Ratio Rank: 65
VTTHX Sortino Ratio Rank: 64
VTTHX Omega Ratio Rank: 63
VTTHX Calmar Ratio Rank: 59
VTTHX Martin Ratio Rank: 67

VMLTX

VMLTX Risk / Return Rank: 77
VMLTX Sharpe Ratio Rank: 89
VMLTX Sortino Ratio Rank: 96
VMLTX Omega Ratio Rank: 97
VMLTX Calmar Ratio Rank: 56
VMLTX Martin Ratio Rank: 45

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.

VTTHX vs. VMLTX - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Target Retirement 2035 Fund (VTTHX) and Vanguard Limited-Term Tax-Exempt Fund Investor Shares (VMLTX). 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.

	VTTHX	VMLTX	Difference
Sharpe ratio: Return per unit of total volatility	2.38	2.93	-0.55
Sortino ratio: Return per unit of downside risk	3.37	5.38	-2.00
Omega ratio: Gain probability vs. loss probability	1.44	1.96	-0.52
Calmar ratio: Return relative to maximum drawdown	2.96	2.86	+0.10
Martin ratio: Return relative to average drawdown	13.04	9.48	+3.56
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VTTHX vs. VMLTX - Sharpe Ratio Comparison

The current VTTHX Sharpe Ratio is 2.38, which is comparable to the VMLTX Sharpe Ratio of 2.93. The chart below compares the historical Sharpe Ratios of VTTHX and VMLTX, 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

	VTTHX	VMLTX	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.38	2.93	-0.55
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.68	1.14	-0.46
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.78	1.10	-0.32
Sharpe Ratio (All Time) Calculated using the full available price history	0.53	1.93	-1.40

Drawdowns

VTTHX vs. VMLTX - Drawdown Comparison

The maximum VTTHX drawdown since its inception was -51.76%, which is greater than VMLTX's maximum drawdown of -6.41%. Use the drawdown chart below to compare losses from any high point for VTTHX and VMLTX.

Drawdown Indicators

	VTTHX	VMLTX	Difference
Max Drawdown Largest peak-to-trough decline	-51.76%	-6.41%	-45.35%
Max Drawdown (1Y) Largest decline over 1 year	-7.17%	-1.53%	-5.64%
Max Drawdown (3Y) Largest decline over 3 years	-10.87%	-2.02%	-8.85%
Max Drawdown (5Y) Largest decline over 5 years	-23.53%	-5.69%	-17.84%
Max Drawdown (10Y) Largest decline over 10 years	-27.15%	-6.41%	-20.74%
Current Drawdown Current decline from peak	-0.60%	-0.40%	-0.20%
Average Drawdown Average peak-to-trough decline	-6.09%	-0.48%	-5.61%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.63%	0.46%	+1.17%

Volatility

VTTHX vs. VMLTX - Volatility Comparison

Vanguard Target Retirement 2035 Fund (VTTHX) has a higher volatility of 2.86% compared to Vanguard Limited-Term Tax-Exempt Fund Investor Shares (VMLTX) at 0.46%. This indicates that VTTHX's price experiences larger fluctuations and is considered to be riskier than VMLTX based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VTTHX	VMLTX	Difference
Volatility (1M) Calculated over the trailing 1-month period	2.86%	0.46%	+2.40%
Volatility (6M) Calculated over the trailing 6-month period	7.19%	1.13%	+6.06%
Volatility (1Y) Calculated over the trailing 1-year period	8.91%	1.49%	+7.42%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	11.38%	1.86%	+9.52%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	12.46%	1.93%	+10.53%

VTTHX vs. VMLTX - Expense Ratio Comparison

VTTHX has a 0.08% expense ratio, which is lower than VMLTX'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%.

Dividends

VTTHX vs. VMLTX - Dividend Comparison

VTTHX's dividend yield for the trailing twelve months is around 2.72%, less than VMLTX's 3.07% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VMLTX Vanguard Limited-Term Tax-Exempt Fund Investor Shares	3.07%	3.75%	3.27%	2.30%	1.56%	1.64%	1.62%	2.01%	1.81%	1.55%	1.52%	1.50%
VTTHX Vanguard Target Retirement 2035 Fund	2.72%	2.96%	3.12%	2.47%	2.71%	19.52%	2.50%	2.33%	2.69%	0.16%	2.77%	4.67%

Frequently Asked Questions

Can I hold both VTTHX and VMLTX in my portfolio?

VTTHX and VMLTX have a correlation of 0.19, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VTTHX or VMLTX?

VTTHX has higher volatility (2.86%) compared to VMLTX (0.46%). In terms of maximum drawdown, VTTHX dropped -51.76% vs VMLTX's -6.41%.

Which has better risk-adjusted returns?

VMLTX currently has the higher Sharpe Ratio (2.93 vs 2.38), 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.