TAXF vs VYM
American Century Diversified Municipal Bond ETF vs Vanguard High Dividend Yield ETF
Which is better, TAXF or VYM?
Municipal Bond against Large Cap Value.
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | TAXF | VYM |
|---|---|---|
| Expense Ratio | 0.25% | 0.04%Best |
| AUM | $680M | $81.6B |
| Dividend Yield | 3.88% | 2.22% |
| Holdings | 785 | 613 |
| YTD Return | -1.54% | +13.91%Best |
| 1Y Return | +0.50% | +17.57%Best |
| 3Y Return (annualized) | +3.12% | +18.12%Best |
| 5Y Return (annualized) | +0.27% | +12.17%Best |
| Volatility (annualized) | 6.0%Best | 15.5% |
| Max Drawdown | -13.9%Best | -35.7% |
| $10,000 over 5 years | $10,136 | $17,758Best |
| Fund Family | American Century Investments | Vanguard (US) |
| Category | Tax Preferred | Equity |
| Style | Municipal Bond | Large Cap Value |
| Inception | Sep 10, 2018 | Nov 10, 2006 |
Not shown on this pair: Top 10 Weight.
Volatility and max drawdown are measured over the window both funds cover: Sep 12, 2018 to Sep 11, 2026 (8 years).
TAXF vs VYM growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view covers the 8 years both funds cover.
TAXF vs VYM Performance
American Century Diversified Municipal Bond ETF (TAXF) is an ETF from American Century Investments and Vanguard High Dividend Yield ETF (VYM) is an ETF from Vanguard (US). Over the past year TAXF returned +0.50% while VYM returned +17.57%. Year to date, TAXF is down 1.54% versus a gain of 13.91% for VYM.
Over three years, TAXF compounded at +3.12% per year against +18.12% for VYM; over five years the annualized figures are +0.27% and +12.17% respectively. Across the full 8-year window we track, VYM has the edge at +10.25% annualized vs +1.60%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 15.5% compared with 6.0% for TAXF. 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 -13.9% for TAXF and -35.7% for VYM. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.42. They move together some of the time, and apart the rest.
Fees and Cost Over Time
TAXF charges 0.25% per year while VYM charges 0.04%. On a $10,000 position that is $25 vs $4 annually, a gap of $21 per year that compounds over a long holding period. On income, TAXF currently yields 3.88% against 2.22% for VYM.
Holdings Overlap
We hold position weights for 482 holdings in TAXF and 603 in VYM, totalling 54.3% and 99.5% of the two funds. The two books name no position in common, so there is no overlap percentage to show.
The two holdings books were reported 48 days apart, TAXF as of Aug 17, 2026 and VYM as of Jun 30, 2026, so some of the difference between them is the time between the two reports rather than the funds.
0 positions in common, counted across the 482 positions we hold weights for in TAXF and 603 in VYM, against full books of 785 and 613.
You are not choosing between two funds in isolation.
Whichever of TAXF and VYM you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, TAXF or VYM?
TAXF has an expense ratio of 0.25% while VYM charges 0.04%. VYM is the cheaper option, by $21 a year on a $10,000 investment.
Which performed better, TAXF or VYM?
Over the past year TAXF returned +0.50% vs +17.57% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (8 years), TAXF annualized +1.60% vs +10.25% for VYM. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, TAXF or VYM?
VYM has been the more volatile fund at 15.5% annualized versus 6.0% for TAXF. Worst drawdown: TAXF -13.9% vs VYM -35.7%.
Should I hold both TAXF and VYM?
TAXF and VYM have a monthly-return correlation of 0.42, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, TAXF or VYM?
TAXF yields 3.88% while VYM yields 2.22%, so TAXF currently pays the higher dividend yield.
Is VYM better than TAXF?
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window. Which one suits a particular account depends on what it is for. This is information, not a recommendation.