ZTAX vs. OVM

Last updated Jun 5, 2026

ZTAX (X-Square Municipal Income Tax Free ETF) and OVM (Overlay Shares Municipal Bond ETF) are both Municipal Bonds funds. Both are actively managed. Over the past 3 years, ZTAX returned 4.56%/yr vs 5.37%/yr for OVM. At a 0.02 correlation, their price movements are largely independent. ZTAX charges 1.14%/yr vs 0.82%/yr for OVM.

Performance

ZTAX vs. OVM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in X-Square Municipal Income Tax Free ETF (ZTAX) and Overlay Shares Municipal Bond ETF (OVM). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, ZTAX achieves a 0.20% return, which is significantly lower than OVM's 4.20% return.

ZTAX

• 1D: 0.00%
• 1M: -1.71%
• YTD: 0.20%
• 6M: 5.42%
• 1Y: 5.15%
• 3Y*: 4.56%
• 5Y*: —
• 10Y*: —

OVM

• 1D: 0.24%
• 1M: 1.20%
• YTD: 4.20%
• 6M: 4.67%
• 1Y: 11.88%
• 3Y*: 5.37%
• 5Y*: 1.63%
• 10Y*: —

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

ZTAX vs. OVM - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023
ZTAX X-Square Municipal Income Tax Free ETF	0.20%	-1.02%	7.98%	9.14%
OVM Overlay Shares Municipal Bond ETF	4.20%	4.14%	3.42%	5.15%

Correlation

The correlation between ZTAX and OVM is -0.08, meaning there is essentially no relationship between their price movements. Each responds to its own set of market drivers, making them strong candidates for combining in a diversified portfolio.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	-0.08
Correlation (3Y) Calculated over the trailing 3-year period	0.02
Correlation (All Time) Calculated using the full available price history since May 22, 2023	0.02

The correlation between ZTAX and OVM shifts across timeframes, from -0.08 (1 year) to 0.02 (all time), reflecting how their relationship changes across market environments.

Return for Risk

ZTAX vs. OVM — Risk / Return Rank

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

ZTAX

ZTAX Risk / Return Rank: 14
ZTAX Sharpe Ratio Rank: 12
ZTAX Sortino Ratio Rank: 13
ZTAX Omega Ratio Rank: 14
ZTAX Calmar Ratio Rank: 15
ZTAX Martin Ratio Rank: 15

OVM

OVM Risk / Return Rank: 89
OVM Sharpe Ratio Rank: 87
OVM Sortino Ratio Rank: 91
OVM Omega Ratio Rank: 91
OVM Calmar Ratio Rank: 87
OVM Martin Ratio Rank: 88

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.

ZTAX vs. OVM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for X-Square Municipal Income Tax Free ETF (ZTAX) and Overlay Shares Municipal Bond ETF (OVM). 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.

	ZTAX	OVM	Difference
Sharpe ratio: Return per unit of total volatility	0.20	2.87	-2.67
Sortino ratio: Return per unit of downside risk	0.48	4.26	-3.79
Omega ratio: Gain probability vs. loss probability	1.08	1.59	-0.51
Calmar ratio: Return relative to maximum drawdown	0.49	4.89	-4.40
Martin ratio: Return relative to average drawdown	1.22	19.04	-17.82
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

ZTAX vs. OVM - Sharpe Ratio Comparison

The current ZTAX Sharpe Ratio is 0.20, which is lower than the OVM Sharpe Ratio of 2.87. The chart below compares the historical Sharpe Ratios of ZTAX and OVM, 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

	ZTAX	OVM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.20	2.87	-2.67
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	—	0.30	—
Sharpe Ratio (All Time) Calculated using the full available price history	0.20	0.43	-0.23

Drawdowns

ZTAX vs. OVM - Drawdown Comparison

The maximum ZTAX drawdown since its inception was -15.33%, roughly equal to the maximum OVM drawdown of -15.58%. Use the drawdown chart below to compare losses from any high point for ZTAX and OVM.

Drawdown Indicators

	ZTAX	OVM	Difference
Max Drawdown Largest peak-to-trough decline	-15.33%	-15.58%	+0.25%
Max Drawdown (1Y) Largest decline over 1 year	-10.47%	-2.44%	-8.03%
Max Drawdown (3Y) Largest decline over 3 years	-15.33%	-8.20%	-7.13%
Max Drawdown (5Y) Largest decline over 5 years	—	-15.58%	—
Current Drawdown Current decline from peak	-6.58%	0.00%	-6.58%
Average Drawdown Average peak-to-trough decline	-6.81%	-4.01%	-2.80%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.23%	0.63%	+3.60%

Volatility

ZTAX vs. OVM - Volatility Comparison

X-Square Municipal Income Tax Free ETF (ZTAX) has a higher volatility of 4.07% compared to Overlay Shares Municipal Bond ETF (OVM) at 1.27%. This indicates that ZTAX's price experiences larger fluctuations and is considered to be riskier than OVM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	ZTAX	OVM	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.07%	1.27%	+2.80%
Volatility (6M) Calculated over the trailing 6-month period	21.51%	3.37%	+18.14%
Volatility (1Y) Calculated over the trailing 1-year period	26.32%	4.16%	+22.16%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	26.83%	5.39%	+21.44%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	26.83%	6.54%	+20.29%

ZTAX vs. OVM - Expense Ratio Comparison

ZTAX has a 1.14% expense ratio, which is higher than OVM's 0.82% expense ratio.

Dividends

ZTAX vs. OVM - Dividend Comparison

ZTAX's dividend yield for the trailing twelve months is around 4.56%, less than OVM's 6.10% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019
OVM Overlay Shares Municipal Bond ETF	6.10%	5.45%	4.91%	4.66%	4.21%	6.10%	3.97%	0.58%
ZTAX X-Square Municipal Income Tax Free ETF	4.56%	4.58%	4.55%	2.14%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both ZTAX and OVM in my portfolio?

ZTAX and OVM have a correlation of -0.08, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, ZTAX or OVM?

ZTAX has higher volatility (4.07%) compared to OVM (1.27%). In terms of maximum drawdown, ZTAX dropped -15.33% vs OVM's -15.58%.

Which ETF is better, ZTAX or OVM?

On 3-year performance, OVM leads with 5.37% vs 4.56% for ZTAX. On fees, OVM is cheaper at 0.82% per year. On volatility, OVM has been the lower-risk option at 1.27%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, ZTAX or OVM?

Over the 3-year period, OVM has performed better with a 5.37% return vs 4.56%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, ZTAX or OVM?

OVM is cheaper with a 0.82% expense ratio, compared with 1.14% for ZTAX.

Which ETF pays a higher dividend yield, ZTAX or OVM?

OVM has the higher dividend yield at 6.10%, compared with 4.56% for ZTAX.

What is the main difference between ZTAX and OVM?

They also come from different issuers: X-Square and Liquid Strategies. Their fees differ too: 1.14% for ZTAX and 0.82% for OVM.

Which has better risk-adjusted returns?

OVM currently has the higher Sharpe Ratio (2.87 vs 0.20), 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.