VMLUX vs VUG
Vanguard Limited Term Tax-Exempt Fund admiral class vs Vanguard Growth ETF
Quick Verdict
VUG has a lower expense ratio. VUG delivered stronger 1-year returns. VMLUX offers more diversification with 915 holdings.
Side-by-Side Comparison
| Metric | VMLUX | VUG | Winner |
|---|---|---|---|
| Expense Ratio | 0.09% | 0.03% | |
| AUM | $34.1B | $223.2B | |
| Dividend Yield | 2.89% | 0.47% | |
| Holdings | 7,110 | 155 | |
| YTD Return | -0.64% | +10.30% | |
| 1Y Return | -0.36% | +17.28% | |
| 3Y Return (annualized) | +0.81% | +24.74% | |
| 5Y Return (annualized) | -0.58% | +13.10% | |
| Volatility (annualized) | 2.8% | 16.5% | |
| Max Drawdown | -8.5% | -51.4% | |
| Fund Family | Vanguard (US) | Vanguard (US) | |
| Category | Tax Preferred | Equity | |
| Inception | Feb 12, 2001 | Jan 26, 2004 |
VMLUX vs VUG Performance
Vanguard Limited Term Tax-Exempt Fund admiral class (VMLUX) is a mutual fund from Vanguard (US) and Vanguard Growth ETF (VUG) is a ETF from Vanguard (US). Over the past year VMLUX returned -0.36% while VUG returned +17.28%. Year to date, VMLUX is down 0.64% versus a gain of 10.30% for VUG.
Over three years, VMLUX compounded at +0.81% per year against +24.74% for VUG; over five years the annualized figures are -0.58% and +13.10% respectively. Across the full 5-year window we track, VUG has the edge at +11.29% annualized vs -0.58%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VUG has been the more volatile fund, with annualized monthly volatility of 16.5% compared with 2.8% for VMLUX. 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 -8.5% for VMLUX and -51.4% for VUG. 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
VMLUX charges 0.09% per year while VUG charges 0.03%. On a $10,000 position that is $9 vs $3 annually, a gap of $6 per year that compounds over a long holding period. On income, VMLUX currently yields 2.89% against 0.47% for VUG.
Holdings Overlap
VMLUX and VUG share 0 holdings out of 1061 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, VMLUX or VUG?
VMLUX has an expense ratio of 0.09% while VUG charges 0.03%. VUG is the cheaper option. On a $10,000 investment, that is $6 per year of difference.
Which performed better, VMLUX or VUG?
Over the past year VMLUX returned -0.36% vs +17.28% for VUG, so VUG leads on 1-year performance. Over the longest common window we track (5 years), VMLUX annualized -0.58% vs +11.29% for VUG. Past performance does not guarantee future results.
Which is riskier, VMLUX or VUG?
VUG has been the more volatile fund at 16.5% annualized versus 2.8% for VMLUX. Worst drawdown: VMLUX -8.5% vs VUG -51.4%.
Should I hold both VMLUX and VUG?
VMLUX and VUG 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 VMLUX and VUG?
VMLUX and VUG share 0 common holdings with a 0.0% weight overlap. Combined, they hold 1061 unique securities.
Which pays a higher dividend, VMLUX or VUG?
VMLUX yields 2.89% while VUG yields 0.47%, so VMLUX currently pays the higher dividend yield.
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