VUSB vs. VWSTX

Last updated Jun 4, 2026

VUSB (Vanguard Ultra-Short Bond ETF) and VWSTX (Vanguard Short-Term Tax-Exempt Fund Investor Shares) are both funds - VUSB is a Ultrashort Bond fund actively managed by Vanguard, while VWSTX is a Municipal Bonds fund managed by Vanguard. Over the past 5 years, VUSB returned 3.43%/yr vs 2.50%/yr for VWSTX. At a 0.32 correlation, their price movements are largely independent. VUSB charges 0.10%/yr vs 0.17%/yr for VWSTX.

Performance

VUSB vs. VWSTX - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Ultra-Short Bond ETF (VUSB) and Vanguard Short-Term Tax-Exempt Fund Investor Shares (VWSTX). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, VUSB achieves a 1.39% return, which is significantly higher than VWSTX's 1.10% return.

VUSB

• 1D: -0.02%
• 1M: 0.40%
• YTD: 1.39%
• 6M: 1.76%
• 1Y: 4.59%
• 3Y*: 5.34%
• 5Y*: 3.43%
• 10Y*: —

VWSTX

• 1D: 0.00%
• 1M: 0.25%
• YTD: 1.10%
• 6M: 1.43%
• 1Y: 3.68%
• 3Y*: 4.13%
• 5Y*: 2.50%
• 10Y*: 1.95%

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

VUSB vs. VWSTX - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021
VUSB Vanguard Ultra-Short Bond ETF	1.39%	5.20%	5.68%	5.52%	-0.36%	0.00%
VWSTX Vanguard Short-Term Tax-Exempt Fund Investor Shares	1.10%	4.79%	3.68%	3.87%	-0.81%	0.05%

Correlation

The correlation between VUSB and VWSTX is 0.31, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.31
Correlation (3Y) Calculated over the trailing 3-year period	0.29
Correlation (5Y) Calculated over the trailing 5-year period	0.33
Correlation (All Time) Calculated using the full available price history since Apr 8, 2021	0.32

Return for Risk

VUSB vs. VWSTX — Risk / Return Rank

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

VUSB

VUSB Risk / Return Rank: 98
VUSB Sharpe Ratio Rank: 99
VUSB Sortino Ratio Rank: 99
VUSB Omega Ratio Rank: 99
VUSB Calmar Ratio Rank: 97
VUSB Martin Ratio Rank: 98

VWSTX

VWSTX Risk / Return Rank: 96
VWSTX Sharpe Ratio Rank: 95
VWSTX Sortino Ratio Rank: 99
VWSTX Omega Ratio Rank: 99
VWSTX Calmar Ratio Rank: 93
VWSTX Martin Ratio Rank: 96

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.

VUSB vs. VWSTX - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Ultra-Short Bond ETF (VUSB) and Vanguard Short-Term Tax-Exempt Fund Investor Shares (VWSTX). 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.

	VUSB	VWSTX	Difference
Sharpe ratio: Return per unit of total volatility	7.10	3.38	+3.72
Sortino ratio: Return per unit of downside risk	13.16	8.40	+4.76
Omega ratio: Gain probability vs. loss probability	3.44	2.64	+0.79
Calmar ratio: Return relative to maximum drawdown	12.43	5.35	+7.08
Martin ratio: Return relative to average drawdown	71.97	23.63	+48.34
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VUSB vs. VWSTX - Sharpe Ratio Comparison

The current VUSB Sharpe Ratio is 7.10, which is higher than the VWSTX Sharpe Ratio of 3.38. The chart below compares the historical Sharpe Ratios of VUSB and VWSTX, 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

	VUSB	VWSTX	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	7.10	3.38	+3.72
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	4.14	2.08	+2.07
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	—	1.76	—
Sharpe Ratio (All Time) Calculated using the full available price history	4.09	2.03	+2.06

Drawdowns

VUSB vs. VWSTX - Drawdown Comparison

The maximum VUSB drawdown since its inception was -1.79%, smaller than the maximum VWSTX drawdown of -3.09%. Use the drawdown chart below to compare losses from any high point for VUSB and VWSTX.

Drawdown Indicators

	VUSB	VWSTX	Difference
Max Drawdown Largest peak-to-trough decline	-1.79%	-3.09%	+1.30%
Max Drawdown (1Y) Largest decline over 1 year	-0.37%	-0.69%	+0.32%
Max Drawdown (3Y) Largest decline over 3 years	-0.46%	-1.01%	+0.55%
Max Drawdown (5Y) Largest decline over 5 years	-1.79%	-2.32%	+0.53%
Max Drawdown (10Y) Largest decline over 10 years	—	-3.08%	—
Current Drawdown Current decline from peak	-0.02%	0.00%	-0.02%
Average Drawdown Average peak-to-trough decline	-0.27%	-0.32%	+0.05%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.06%	0.16%	-0.10%

Volatility

VUSB vs. VWSTX - Volatility Comparison

The current volatility for Vanguard Ultra-Short Bond ETF (VUSB) is 0.18%, while Vanguard Short-Term Tax-Exempt Fund Investor Shares (VWSTX) has a volatility of 0.38%. This indicates that VUSB experiences smaller price fluctuations and is considered to be less risky than VWSTX based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	VUSB	VWSTX	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.18%	0.38%	-0.20%
Volatility (6M) Calculated over the trailing 6-month period	0.52%	0.81%	-0.29%
Volatility (1Y) Calculated over the trailing 1-year period	0.65%	1.09%	-0.44%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	0.83%	1.21%	-0.38%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	0.82%	1.11%	-0.29%

VUSB vs. VWSTX - Expense Ratio Comparison

VUSB has a 0.10% expense ratio, which is lower than VWSTX'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

VUSB vs. VWSTX - Dividend Comparison

VUSB's dividend yield for the trailing twelve months is around 4.39%, more than VWSTX's 3.04% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
VUSB Vanguard Ultra-Short Bond ETF	4.39%	4.63%	5.16%	4.45%	1.56%	0.26%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%
VWSTX Vanguard Short-Term Tax-Exempt Fund Investor Shares	3.04%	3.90%	3.73%	2.42%	1.16%	0.61%	1.17%	1.71%	1.45%	1.06%	0.87%	0.70%

Frequently Asked Questions

Can I hold both VUSB and VWSTX in my portfolio?

VUSB and VWSTX have a correlation of 0.31, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, VUSB or VWSTX?

VWSTX has higher volatility (0.38%) compared to VUSB (0.18%). In terms of maximum drawdown, VUSB dropped -1.79% vs VWSTX's -3.09%.

Which has better risk-adjusted returns?

VUSB currently has the higher Sharpe Ratio (7.10 vs 3.38), 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.