Key Points
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Vanguard Intermediate-Term Treasury ETF offers a slightly lower expense ratio and a higher trailing distribution yield than iShares National Muni Bond ETF.
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iShares National Muni Bond ETF has generated higher total returns over the last 12 months while maintaining a lower maximum drawdown over a five-year horizon.
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While Vanguard Intermediate-Term Treasury ETF focuses on intermediate‑term U.S. government debt, iShares National Muni Bond ETF provides exposure to a diversified portfolio of investment‑grade municipal bonds.
Snapshot (cost & size)
MetricMUBVGITIssueriSharesVanguardExpense ratio0.05%0.03%1-yr return (as of June 17, 2026)6.10%3.10%Dividend yield3.20%3.90%Beta0.240.17AUM$45.4 billion$49.5 billion
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Performance & risk comparison
MetricMUBVGITMax drawdown (5 yr)(11.90%)(15.00%)Growth of $1,000 over 5 years (total return)$1,041$1,003
What’s inside
VGIT is a fixed-income fund without an equity sector breakdown, primarily holding 76 U.S. Treasury bonds. This fund, launched in 2009, has a trailing-12-month dividend of $2.27 per share and remains a liquid option for investors seeking government-backed income.
MUB also operates as a fixed-income fund without an equity sector breakdown and was launched in 2007. It is diversified across six holdings where no single position exceeds 0.89% of the portfolio, ensuring limited exposure to any individual municipal issuer. The iShares fund has a trailing-12-month dividend of $3.40 per share, reflecting its focus on high-quality bonds issued by state and local governments across the United States.
What this means for investors
This choice starts with one question: What is your tax bracket? MUB holds more than 6,300 municipal bonds whose income is generally exempt from federal taxes. VGIT holds only U.S. Treasury bonds whose income is fully taxable at the federal level. That single difference can flip the outcome entirely for higher‑bracket investors.
VGIT’s stated yield is slightly higher than MUB’s, but for investors in the 32% or 37% tax bracket, keeping more of every dollar of income matters more than the headline number. Once taxes are applied, MUB’s after-tax income can match or exceed VGIT’s for those in higher brackets. For investors in lower brackets or holding bonds inside a retirement account where tax exemption provides no advantage, VGIT’s lower cost and Treasury‑backed simplicity make it the more straightforward choice.
The five-year track record also favors MUB, which held up better during the rate‑hiking cycle of 2022 through 2024 and delivered stronger total returns including dividends over that period. For most taxable‑account investors in higher tax brackets, MUB is the stronger long‑term choice.
