ZTAX vs. VCRM

Last updated Jun 5, 2026

ZTAX (X-Square Municipal Income Tax Free ETF) and VCRM (Vanguard Core Tax-Exempt Bond ETF) are both Municipal Bonds funds. ZTAX is actively managed, while VCRM is passively managed. Over the past year, ZTAX returned 5.15% vs 8.13% for VCRM. At a correlation of -0.01, they often move in opposite directions. ZTAX charges 1.14%/yr vs 0.12%/yr for VCRM.

Performance

ZTAX vs. VCRM - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in X-Square Municipal Income Tax Free ETF (ZTAX) and Vanguard Core Tax-Exempt Bond ETF (VCRM). 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 VCRM's 2.08% return.

ZTAX

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

VCRM

• 1D: 0.13%
• 1M: 0.80%
• YTD: 2.08%
• 6M: 2.57%
• 1Y: 8.13%
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

ZTAX vs. VCRM - Yearly Performance Comparison

	2026 (YTD)	2025	2024
ZTAX X-Square Municipal Income Tax Free ETF	0.20%	-1.02%	-0.35%
VCRM Vanguard Core Tax-Exempt Bond ETF	2.08%	4.91%	-0.58%

Correlation

The correlation between ZTAX and VCRM is -0.11, meaning they tend to move in opposite directions. This is especially valuable for risk management - when one declines, the other has historically tended to hold steady or rise.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	-0.11
Correlation (All Time) Calculated using the full available price history since Nov 22, 2024	-0.01

The correlation between ZTAX and VCRM shifts across timeframes, from -0.11 (1 year) to -0.01 (all time), reflecting how their relationship changes across market environments.

Return for Risk

ZTAX vs. VCRM — 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

VCRM

VCRM Risk / Return Rank: 77
VCRM Sharpe Ratio Rank: 83
VCRM Sortino Ratio Rank: 88
VCRM Omega Ratio Rank: 91
VCRM Calmar Ratio Rank: 61
VCRM 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.

ZTAX vs. VCRM - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for X-Square Municipal Income Tax Free ETF (ZTAX) and Vanguard Core Tax-Exempt Bond ETF (VCRM). 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	VCRM	Difference
Sharpe ratio: Return per unit of total volatility	0.20	2.68	-2.48
Sortino ratio: Return per unit of downside risk	0.48	3.96	-3.48
Omega ratio: Gain probability vs. loss probability	1.08	1.58	-0.51
Calmar ratio: Return relative to maximum drawdown	0.49	3.00	-2.50
Martin ratio: Return relative to average drawdown	1.22	11.11	-9.89
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. VCRM - Sharpe Ratio Comparison

The current ZTAX Sharpe Ratio is 0.20, which is lower than the VCRM Sharpe Ratio of 2.68. The chart below compares the historical Sharpe Ratios of ZTAX and VCRM, 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	VCRM	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.20	2.68	-2.48
Sharpe Ratio (All Time) Calculated using the full available price history	0.20	1.09	-0.89

Drawdowns

ZTAX vs. VCRM - Drawdown Comparison

The maximum ZTAX drawdown since its inception was -15.33%, which is greater than VCRM's maximum drawdown of -4.12%. Use the drawdown chart below to compare losses from any high point for ZTAX and VCRM.

Drawdown Indicators

	ZTAX	VCRM	Difference
Max Drawdown Largest peak-to-trough decline	-15.33%	-4.12%	-11.21%
Max Drawdown (1Y) Largest decline over 1 year	-10.47%	-2.72%	-7.75%
Max Drawdown (3Y) Largest decline over 3 years	-15.33%	—	—
Current Drawdown Current decline from peak	-6.58%	-0.13%	-6.45%
Average Drawdown Average peak-to-trough decline	-6.81%	-1.13%	-5.68%
Ulcer Index Depth and duration of drawdowns from previous peaks	4.23%	0.73%	+3.50%

Volatility

ZTAX vs. VCRM - Volatility Comparison

X-Square Municipal Income Tax Free ETF (ZTAX) has a higher volatility of 4.07% compared to Vanguard Core Tax-Exempt Bond ETF (VCRM) at 0.98%. This indicates that ZTAX's price experiences larger fluctuations and is considered to be riskier than VCRM based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	ZTAX	VCRM	Difference
Volatility (1M) Calculated over the trailing 1-month period	4.07%	0.98%	+3.09%
Volatility (6M) Calculated over the trailing 6-month period	21.51%	2.17%	+19.34%
Volatility (1Y) Calculated over the trailing 1-year period	26.32%	3.05%	+23.27%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	26.83%	3.89%	+22.94%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	26.83%	3.89%	+22.94%

ZTAX vs. VCRM - Expense Ratio Comparison

ZTAX has a 1.14% expense ratio, which is higher than VCRM's 0.12% expense ratio.

Dividends

ZTAX vs. VCRM - Dividend Comparison

ZTAX's dividend yield for the trailing twelve months is around 4.56%, more than VCRM's 3.63% yield.

Position	TTM	2025	2024	2023
VCRM Vanguard Core Tax-Exempt Bond ETF	3.63%	3.42%	0.40%	0.00%
ZTAX X-Square Municipal Income Tax Free ETF	4.56%	4.58%	4.55%	2.14%

Frequently Asked Questions

Can I hold both ZTAX and VCRM in my portfolio?

ZTAX and VCRM have a correlation of -0.11, 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 VCRM?

ZTAX has higher volatility (4.07%) compared to VCRM (0.98%). In terms of maximum drawdown, ZTAX dropped -15.33% vs VCRM's -4.12%.

Which ETF is better, ZTAX or VCRM?

On 1-year performance, VCRM leads with 8.13% vs 5.15% for ZTAX. On fees, VCRM is cheaper at 0.12% per year. On volatility, VCRM has been the lower-risk option at 0.98%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, ZTAX or VCRM?

Over the 1-year period, VCRM has performed better with a 8.13% return vs 5.15%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, ZTAX or VCRM?

VCRM is cheaper with a 0.12% expense ratio, compared with 1.14% for ZTAX.

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

ZTAX has the higher dividend yield at 4.56%, compared with 3.63% for VCRM.

What is the main difference between ZTAX and VCRM?

They also come from different issuers: X-Square and Vanguard. Their fees differ too: 1.14% for ZTAX and 0.12% for VCRM.

Which has better risk-adjusted returns?

VCRM currently has the higher Sharpe Ratio (2.68 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.