ETF Evaluator:
Vanguard Short Duration Tax-Exm Bd ETF ()
Follow This ETF
(as of Aug 26)
Best Performing in Muni National Short Over the Last Year
| 5.4% | abrdn Ultra Short Municipal Inc Act ETF (AMUN) |
| 3.2% | Vanguard Short Duration Tax-Exm Bd ETF (VSDM) |
| 3.2% | Capital Group Short Dur Muncpl Inc ETF (CGSM) |
| 3.2% | NYLI MacKay Muni Short Duration ETF (MMSD) |
| 3.2% | PGIM Ultra Short Municipal Bond ETF (PUSH) |
Risk
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Risk
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ETF Details
Vanguard Short Duration Tax-Exm Bd ETF Overview
Vanguard Short Duration Tax-Exm Bd ETF (VSDM) is an actively managed Municipal Bond Muni National Short exchange-traded fund (ETF). Vanguard launched the ETF in 2024.
The investment seeks to provide current income that is exempt from federal personal income taxes, with limited price volatility.
Under normal circumstances, the fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in debt securities that are primarily issued by U.S. states, local governments, or agencies and whose interest is exempt from federal income taxes and the federal alternative minimum tax (AMT). It is non-diversified.
About Vanguard Short Duration Tax-Exm Bd ETF (VSDM)
There are 2 members of the management team with an average tenure of 1.69 years: James D'Arcy (2024) and Adam Ferguson (2024). Management tenure is more important for actively managed ETFs than passive index ETFs.
The ETF has 2 primary benchmarks: Bloomberg Municipal TR USD index with a weighting of 100% and S&P BROAD AMT- FREE MUNICIPAL TR USD index with a weighting of 100%. Vanguard Short Duration Tax-Exm Bd ETF has 2787 securities in its portfolio. The top 10 holdings constitute 4.0% of the ETF’s assets. The ETF meets the SEC requirement of being classified as a nondiversified fund. The ETF is not considered to have an ESG focus with its investment selection and management.
Vanguard Short Duration Tax-Exm Bd ETF is part of the Fixed Income global asset class and is within the Municipal Bond ETF group. Vanguard Short Duration Tax-Exm Bd ETF has 1.0% of its portfolio invested in foreign issues. The overall assets allocated to domestic stock is 0.0% There is 0.0% allocated to foreign stock, and 0.0% is allocated to preferred stocks. The bond allocation as a percentage of total assets is 99.9% (98.9% domestic bond, 1.0% foreign bond and 0.0% convertible bond). Vanguard Short Duration Tax-Exm Bd ETF has 0.1% of the portfolio in cash.
Assets Under Management
The fund has $831 million in total assets, which is below the $1 billion average for the Muni National Short category. Normally, lower assets under management translates to higher average expense ratios, and greater total assets are desired. However, for some investment categories, such as small-cap investing, it may be difficult for the manager to fully employ the desired active strategy if assets grow too large or too quickly.
VSDM Performance and Fees
The expense ratio measures how much of a fund’s assets are used for administrative expenses and operating expenses, including adviser fees and fees for the transfer agent and custodial services. The Vanguard Short Duration Tax-Exm Bd ETF expense ratio is low compared to funds in the Muni National Short category. Vanguard Short Duration Tax-Exm Bd ETF has an expense ratio of 0.12%, which is 43% lower than its category average, making the fund expense ratio grade a A. While it is difficult to predict returns, it is known that high annual expense ratios reduce your rate of return, and excessive fees are difficult to overcome. Active management normally comes with higher expense ratios than passive index management. Certain investment categories such as small company and foreign also normally have higher expense ratios. It is best to compare fund expense ratios against the category averages for meaningful assessments.
High portfolio turnover can translate to higher expenses and lower aftertax returns. Vanguard Short Duration Tax-Exm Bd ETF has a portfolio turnover rate of 13%, which indicates that it holds its assets around / 0.1 years. By way of comparison, the average portfolio turnover is 56% for the Muni National Short category.
Recently, in the month of July 2026, Vanguard Short Duration Tax-Exm Bd ETF returned -0.5%, which earned it a grade of F, as the Muni National Short category had an average return of -0.2%. The letter grades of A, B, C, D and F are based upon relative rankings within the investment category. A grade of A, for example, would indicate that the return is in the highest 20% for that time period compared to all ETFs in that category.
Vanguard Short Duration Tax-Exm Bd ETF has a trailing yield of 3.12%, which is above the 2.91% category average.
The fund normally distributes its income monthly and its capital gains annually.
It’s natural to seek the best-performing investments, but you must consider the relationship between risk and return and the impact of costs and taxes on your realized returns.
Vanguard Short Duration Tax-Exm Bd ETF Grades
Year to date, the ETF has returned 1.0%, 0.1 percentage points worse than the category, which translates into a grade of D. The fund has returned 3.2% over the past year (grade of A).
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VSDM Trailing NAV Total Returns Data as of 7/31/26
| Last Month |
Last Quarter |
Ann'l. 1Yr |
Ann'l. 3Yr |
Ann'l. 5Yr |
Ann'l. 10Yr |
|
| VSDM Return (NAV) | -0.5% | 0.2% | 3.2% | na | na | na |
| VSDM Return (Price) | -0.5% | 0.2% | 3.3% | na | na | na |
| NAV +/- Price Return | -0.013% | -0.013% | -0.053% | na | na | na |
| Muni National Short Avg | -0.2% | 0.4% | 2.8% | 3.2% | 1.7% | 1.5% |
| VSDM Grade (NAV) | F | F | A | na | na | na |
| +/- Category (NAV) | -0.3% | -0.2% | 0.5% | na | na | na |
| VSDM Tax-Cost Ratio | na | na | 0.0% | na | na | na |
VSDM Annual NAV Total ReturnsData as of 7/31/26
| 2026 | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | |
| VSDM Return (NAV) | 1.0% | 5.4% | na | na | na | na | na | na | na | na | na |
| VSDM Return (Price) | 1.0% | 5.4% | na | na | na | na | na | na | na | na | na |
| NAV +/- Price Ret | -0.000% | -0.001% | na | na | na | na | na | na | na | na | na |
| Muni National Short Avg | 1.1% | 3.8% | 2.7% | 3.8% | -2.1% | 0.4% | 2.1% | 3.0% | 1.3% | 1.5% | -0.1% |
| VSDM Grade (NAV) | D | A | na | na | na | na | na | na | na | na | na |
| +/- Category | -0.1% | 1.6% | na | na | na | na | na | na | na | na | na |
| Risk Measures | |
| Beta: | na |
| R-Squared: | na |
| Standard Deviation: | na |
| Category Risk Index: | na |
| Category Risk Rating: | |
| Total Risk Index: | na |
| Total Risk Rating: | |
| Portfolio Characteristics | |
| Yield: | 3.1% |
| Total Assets: | $ 831 Mil |
| Share Class Assets: | $ 831 Mil |
| Turnover: | 13.0% |
| Expense Ratio: | 0.12% |
| Index Fund: | No |
| Index Tracked: | Bloomberg Municipal TR USD |
| Index Weighting: | 100% |
| Leveraged: | No |
| Socially Responsible Fund: | No |
| Capital Gains Distribution Frequency: | Annually |
| Income Distribution Frequency: | Monthly |
Management Team
| Number of Managers: 2 | |||
| Longest Tenure: 1.7 years | |||
| Average Tenure: 1.7 years | |||
| Managers (Year): D'Arcy James (2024), Ferguson Adam (2024) | |||
Portfolio Composition (as of 6/30/26)
| # of Holdings: | 2787 |
| % in Top 10 Holdings: | 4.0% |
| Fund is Non-Diversified: | Yes |
| % in Foreign Issues: | 1.0% |
Portfolio Allocation |
|
| Domestic Stock: | 0.0% |
| Foreign Stock: | 0.0% |
| Preferred Stock: | 0.0% |
| Domestic Bond: | 98.9% |
| Foreign Bond: | 1.0% |
| Convertible Bond: | 0.0% |
| Other: | 0.0% |
| Cash: | 0.1% |
Purchase Information
| Legal Structure: | Open Ended Investment Company |
| Fund Family: | Vanguard |
| Phone Number: | 866-499-8473 |
| Website: | www.vanguard.com |
| Inception Date: | November 21, 2024 |
Expenses and Fees
| Expense Ratio (%): | 0.12% (Rating: Low) |
| Category Average Expense Ratio (%): | 0.21% |
