VCSH vs VTEB
Vanguard Short Term Corporate Bond ETF vs Vanguard Tax-Exempt Bond ETF
Quick Verdict
VTEB delivered stronger 1-year returns. VTEB offers more diversification with 3533 holdings.
Side-by-Side Comparison
| Metric | VCSH | VTEB | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.03% | |
| AUM | $44.9B | $46.0B | |
| Dividend Yield | 4.44% | 3.34% | |
| Holdings | 2,719 | 9,952 | |
| YTD Return | +0.70% | +0.59% | |
| 1Y Return | +2.88% | +4.98% | |
| 3Y Return (annualized) | +5.52% | +3.13% | |
| 5Y Return (annualized) | +2.31% | +0.63% | |
| Volatility (annualized) | 2.6% | 4.9% | |
| Max Drawdown | -12.9% | -17.0% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Tax Preferred | |
| Inception | Nov 19, 2009 | Aug 21, 2015 |
VCSH vs VTEB Performance
Vanguard Short Term Corporate Bond ETF (VCSH) is a ETF from Vanguard (US) and Vanguard Tax-Exempt Bond ETF (VTEB) is a ETF from Vanguard (US). Over the past year VCSH returned +2.88% while VTEB returned +4.98%. Year to date, VCSH is up 0.70% versus a gain of 0.59% for VTEB.
Over three years, VCSH compounded at +5.52% per year against +3.13% for VTEB; over five years the annualized figures are +2.31% and +0.63% respectively. Across the full 11-year window we track, VCSH has the edge at +1.28% annualized vs +1.27%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VTEB has been the more volatile fund, with annualized monthly volatility of 4.9% compared with 2.6% for VCSH. 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 -12.9% for VCSH and -17.0% for VTEB. 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 0.77. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VCSH charges 0.03% per year while VTEB charges 0.03%. On a $10,000 position that is $3 vs $3 annually. On income, VCSH currently yields 4.44% against 3.34% for VTEB.
Holdings Overlap
VCSH and VTEB share 0 holdings out of 5973 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, VCSH or VTEB?
VCSH has an expense ratio of 0.03% while VTEB charges 0.03%. They cost the same. On a $10,000 investment, that is $0 per year of difference.
Which performed better, VCSH or VTEB?
Over the past year VCSH returned +2.88% vs +4.98% for VTEB, so VTEB leads on 1-year performance. Over the longest common window we track (11 years), VCSH annualized +1.28% vs +1.27% for VTEB. Past performance does not guarantee future results.
Which is riskier, VCSH or VTEB?
VTEB has been the more volatile fund at 4.9% annualized versus 2.6% for VCSH. Worst drawdown: VCSH -12.9% vs VTEB -17.0%.
Should I hold both VCSH and VTEB?
VCSH and VTEB have a monthly-return correlation of 0.77, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VCSH and VTEB?
VCSH and VTEB share 0 common holdings with a 0.0% weight overlap. Combined, they hold 5973 unique securities.
Which pays a higher dividend, VCSH or VTEB?
VCSH yields 4.44% while VTEB yields 3.34%, so VCSH currently pays the higher dividend yield.
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