VGSH vs VMLUX
Vanguard Short Term Treasury ETF vs Vanguard Limited Term Tax-Exempt Fund admiral class
Quick Verdict
VGSH has a lower expense ratio. VGSH delivered stronger 1-year returns. VMLUX offers more diversification with 7,110 holdings.
Side-by-Side Comparison
| Metric | VGSH | VMLUX | Winner |
|---|---|---|---|
| Expense Ratio | 0.03% | 0.09% | |
| AUM | $29.4B | $34.1B | |
| Dividend Yield | 3.87% | 2.89% | |
| Holdings | 94 | 7,110 | |
| YTD Return | +0.81% | -0.55% | |
| 1Y Return | +2.53% | -0.27% | |
| 3Y Return (annualized) | +4.29% | +0.81% | |
| 5Y Return (annualized) | +1.90% | -0.56% | |
| Volatility (annualized) | 1.4% | 2.8% | |
| Max Drawdown | -6.7% | -8.5% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Fixed Income | Tax Preferred | |
| Inception | Nov 19, 2009 | Feb 12, 2001 |
VGSH vs VMLUX Performance
Vanguard Short Term Treasury ETF (VGSH) is a ETF from Vanguard (US) and Vanguard Limited Term Tax-Exempt Fund admiral class (VMLUX) is a mutual fund from Vanguard (US). Over the past year VGSH returned +2.53% while VMLUX returned -0.27%. Year to date, VGSH is up 0.81% versus a loss of 0.55% for VMLUX.
Over three years, VGSH compounded at +4.29% per year against +0.81% for VMLUX; over five years the annualized figures are +1.90% and -0.56% respectively. Across the full 5-year window we track, VGSH has the edge at +0.71% annualized vs -0.56%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VMLUX has been the more volatile fund, with annualized monthly volatility of 2.8% compared with 1.4% for VGSH. 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 -6.7% for VGSH and -8.5% for VMLUX. 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 0.75. They usually move together, but the gap leaves some room for diversification.
Fees and Cost Over Time
VGSH charges 0.03% per year while VMLUX charges 0.09%. On a $10,000 position that is $3 vs $9 annually, a gap of $6 per year that compounds over a long holding period. On income, VGSH currently yields 3.87% against 2.89% for VMLUX.
Holdings Overlap
VGSH and VMLUX share 0 holdings out of 991 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, VGSH or VMLUX?
VGSH has an expense ratio of 0.03% while VMLUX charges 0.09%. VGSH is the cheaper option. On a $10,000 investment, that is $6 per year of difference.
Which performed better, VGSH or VMLUX?
Over the past year VGSH returned +2.53% vs -0.27% for VMLUX, so VGSH leads on 1-year performance. Over the longest common window we track (5 years), VGSH annualized +0.71% vs -0.56% for VMLUX. Past performance does not guarantee future results.
Which is riskier, VGSH or VMLUX?
VMLUX has been the more volatile fund at 2.8% annualized versus 1.4% for VGSH. Worst drawdown: VGSH -6.7% vs VMLUX -8.5%.
Should I hold both VGSH and VMLUX?
VGSH and VMLUX have a monthly-return correlation of 0.75, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between VGSH and VMLUX?
VGSH and VMLUX share 0 common holdings with a 0.0% weight overlap. Combined, they hold 991 unique securities.
Which pays a higher dividend, VGSH or VMLUX?
VGSH yields 3.87% while VMLUX yields 2.89%, so VGSH currently pays the higher dividend yield.
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