TAFI vs VOO
AB Tax Aware Short Duration Municipal ETF vs Vanguard S&P 500 ETF
Quick Verdict
VOO has a lower expense ratio. VOO delivered stronger 1-year returns. VOO offers more diversification with 505 holdings.
Side-by-Side Comparison
| Metric | TAFI | VOO | Winner |
|---|---|---|---|
| Expense Ratio | 0.27% | 0.03% | |
| AUM | $1.4B | $979.0B | |
| Dividend Yield | 2.98% | 1.09% | |
| Holdings | 624 | 509 | |
| YTD Return | +0.96% | +13.79% | |
| 1Y Return | +2.52% | +23.01% | |
| 3Y Return (annualized) | +3.50% | +21.78% | |
| 5Y Return (annualized) | - | +13.39% | |
| Volatility (annualized) | 2.3% | 14.1% | |
| Max Drawdown | -1.9% | -34.3% | |
| Fund Family | AllianceBernstein L.P. | Vanguard (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Sep 13, 2022 | Sep 7, 2010 |
TAFI vs VOO Performance
AB Tax Aware Short Duration Municipal ETF (TAFI) is a ETF from AllianceBernstein L.P. and Vanguard S&P 500 ETF (VOO) is a ETF from Vanguard (US). Over the past year TAFI returned +2.52% while VOO returned +23.01%. Year to date, TAFI is up 0.96% versus a gain of 13.79% for VOO.
Over three years, TAFI compounded at +3.50% per year against +21.78% for VOO. Across the full 4-year window we track, VOO has the edge at +13.57% annualized vs +3.26%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VOO has been the more volatile fund, with annualized monthly volatility of 14.1% compared with 2.3% for TAFI. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -1.9% for TAFI and -34.3% for VOO. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.58. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
TAFI charges 0.27% per year while VOO charges 0.03%. On a $10,000 position that is $27 vs $3 annually, a gap of $24 per year that compounds over a long holding period. On income, TAFI currently yields 2.98% against 1.09% for VOO.
Holdings Overlap
TAFI and VOO share 1 holdings out of 683 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Top Shared Holdings
| Stock | Weight in TAFI | Weight in VOO | Difference |
|---|---|---|---|
| C | 0.01% | 0.36% | 0.35% |
Frequently Asked Questions
Which is cheaper, TAFI or VOO?
TAFI has an expense ratio of 0.27% while VOO charges 0.03%. VOO is the cheaper option. On a $10,000 investment, that is $24 per year of difference.
Which performed better, TAFI or VOO?
Over the past year TAFI returned +2.52% vs +23.01% for VOO, so VOO leads on 1-year performance. Over the longest common window we track (4 years), TAFI annualized +3.26% vs +13.57% for VOO. Past performance does not guarantee future results.
Which is riskier, TAFI or VOO?
VOO has been the more volatile fund at 14.1% annualized versus 2.3% for TAFI. Worst drawdown: TAFI -1.9% vs VOO -34.3%.
Should I hold both TAFI and VOO?
TAFI and VOO have a monthly-return correlation of 0.58, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between TAFI and VOO?
TAFI and VOO share 1 common holdings with a 0.0% weight overlap. Combined, they hold 683 unique securities.
Which pays a higher dividend, TAFI or VOO?
TAFI yields 2.98% while VOO yields 1.09%, so TAFI currently pays the higher dividend yield.
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