VEA vs VTEB
Vanguard FTSE Developed Markets ETF vs Vanguard Tax-Exempt Bond ETF
Quick Verdict
VEA delivered stronger 1-year returns. VTEB offers more diversification with 3533 holdings.
Side-by-Side Comparison
| Metric | VEA | VTEB | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.03% | |
| AUM | $230.9B | $46.0B | |
| Dividend Yield | 2.57% | 3.34% | |
| Holdings | 3,918 | 9,952 | |
| YTD Return | +16.14% | +0.57% | |
| 1Y Return | +29.87% | +5.15% | |
| 3Y Return (annualized) | +20.12% | +3.20% | |
| 5Y Return (annualized) | +10.27% | +0.58% | |
| Volatility (annualized) | 17.8% | 4.9% | |
| Max Drawdown | -62.9% | -17.0% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Equity | Tax Preferred | |
| Inception | Jul 20, 2007 | Aug 21, 2015 |
VEA vs VTEB Performance
Vanguard FTSE Developed Markets ETF (VEA) is a ETF from Vanguard (US) and Vanguard Tax-Exempt Bond ETF (VTEB) is a ETF from Vanguard (US). Over the past year VEA returned +29.87% while VTEB returned +5.15%. Year to date, VEA is up 16.14% versus a gain of 0.57% for VTEB.
Over three years, VEA compounded at +20.12% per year against +3.20% for VTEB; over five years the annualized figures are +10.27% and +0.58% respectively. Across the full 11-year window we track, VEA has the edge at +3.14% annualized vs +1.27%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VEA has been the more volatile fund, with annualized monthly volatility of 17.8% compared with 4.9% for VTEB. 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 -62.9% for VEA 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 0.52. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
VEA charges 0.03% per year while VTEB charges 0.03%. On a $10,000 position that is $3 vs $3 annually. On income, VEA currently yields 2.57% against 3.34% for VTEB.
Holdings Overlap
VEA and VTEB share 0 holdings out of 6541 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, VEA or VTEB?
VEA 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, VEA or VTEB?
Over the past year VEA returned +29.87% vs +5.15% for VTEB, so VEA leads on 1-year performance. Over the longest common window we track (11 years), VEA annualized +3.14% vs +1.27% for VTEB. Past performance does not guarantee future results.
Which is riskier, VEA or VTEB?
VEA has been the more volatile fund at 17.8% annualized versus 4.9% for VTEB. Worst drawdown: VEA -62.9% vs VTEB -17.0%.
Should I hold both VEA and VTEB?
VEA and VTEB have a monthly-return correlation of 0.52, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VEA and VTEB?
VEA and VTEB share 0 common holdings with a 0.0% weight overlap. Combined, they hold 6541 unique securities.
Which pays a higher dividend, VEA or VTEB?
VEA yields 2.57% while VTEB yields 3.34%, so VTEB currently pays the higher dividend yield.
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