MUB vs VWSTX Fund Comparison

A comparison between MUB and VWSTX based on their expense ratio, growth, holdings and how well they match their benchmark performance.

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Minafi's Take on MUB vs VWSTX

Here's an in depth look at the differences between iShares National Muni Bond ETF ($MUB) and Vanguard Short-Term Tax-Exempt Fund ($VWSTX).

To start off, here's a look at the basics of each fund. Keep an eye on the FI Score. That's a custom score from 0 to 100 that we generate based on how good this fund is for the casual investor. Most investors only need a handful of total funds in their portfolio. The higher the score, the more likely this is one of those few. Score alone isn't enough! Keep reading on to see how different (or perhaps similar) these two funds are.

95% FI Score
  • mub
  • ETF
  • Bond
  • Municipal Bond

iShares National Muni Bond ETF

Expenses: 0.07% (Better than 1% of similar funds)

This is a great choice for a Municipal Bond Bond fund. See why »

92% FI Score
  • vwstx
  • Mutual Fund
  • Bond
  • Municipal Bond

Vanguard Short-Term Tax-Exempt Fund

Expenses: 0.17% (Better than 1% of similar funds)

This is a great choice for a Municipal Bond Bond fund. See why »

$MUB is classified as an ETF while $VWSTX is classified as a Mutual Fund. Even though one of these is a mutual fund and the other is an ETF, that doesn't matter too much for their holdings. Both ETFs and mutual funds are just containers to hold lots of investments inside of them.

The biggest differences between these two is where they may be offered. ETFs are more widely availble from a larger number of investment apps and websites. Mutual funds, on the other hand, are generally offered by the platform they're issued by (Fidelity funds on Fidelity, Vanguard funds on Vanguard). Usually 401(k)'s will offer both ETFs and Mutual Funds. If you're investing outside of a 401(k), I'd recommend you verify the fees associated with ETF and mutual fund transactions. Some platforms charge an additional fee to purchase a mutual fund.

To learn more about the difference between these two, you can read about the difference between ETFs and Mutual Funds.

When evaluating a fund, the first things I look at are:

  • What it invests in
  • How much it charges in fees
  • How large the fund is

Let's look into these criteria one by one and see if either of these funds stands out.

Fund Holdings Comparison

Both of these funds are Bond Municipal Bond funds – which means they're likely both investing in about the same investments behind the scenes.

Minafi's FI Score algorithm takes into account the category and market. The more niche a fund is, the lower the score. This doesn't mean it's a worse fund, but it does mean you should stop and make sure this a fund you need to diversify your portfolio.

Market Score 9.9 /10 9.9 /10
Category Score 8.0 /10 8.0 /10
Total 17.9 17.9

A score of 10 means this is a solid market and category that almost every investor will want to have investments in. The lower the score, the more specific the investment. These scores are based on when most investors would add these funds to their portfolio. A score of 10 means that this fund (or one like it) belongs in a three-fund portfolio. The lower the score, the farther down in your portfolio a fund would go.

Winner: $VWSTX

Fee Comparison

Fees are one of the biggest killers of portfolio growth. The difference between a 2% fee and a 0.04% fee over 30 years can result in your portfolio having half the total value!

If you're just getting started investing and learning how fees impact your portfolio, I'd encourage you to read through my free investment course (specifically '2.2 - All About Fees') where I go over all the different types of fees you can be charged and how to lower them.

For these two funds, MUB has an expense ratio of 0.07% while VWSTX has an expense ratio of 0.17%. In this case, both of these funds have a similar fee.

Winner: $MUB (barely)

Fund Size Comparison

Both MUB and VWSTX have a similar number of assets under management. MUB has 16.3 Billion in assets under management, while VWSTX has 16.9 Billion.

Minafi categorizes both of these funds as large funds. Fund size is a good indication of how many other investors trust this fund. A large fund by itself doesn't mean it's a good fund, but it is one thing to consider when figuring out how to choose the right fund.

Winner: tie

Which Should You Choose? MUB or VWSTX?

Since both of these funds are Bond Municipal Bond funds, you'll most likely only need to invest in one of these funds – not both. Running both of these funds through Minafi's FI Score algorithm, gives MUB a score of 95 and VWSTX a score of 92.

Since both of these have a similar FI Score, the difference between these two if minimal. A higher FI Score doesn't mean future growth will be higher, but it does mean that it better fits criteria for a good fund. Honestly though, these two aren't far off. They're both excellent funds.

Winner: tie


iShares National Muni Bond ETF


Read More
Rating Type Rating
Expense Ratio Score 10 /10
Expense Rating 9 /10
Market Score 10 /10
Category Score 8 /10
Overview Details
Fund Type ETF
Inception Date Jul-1-2010
Exchange NYSE ARCA
Expense Ratio 0.070%
Net Assets 16.3 Billion
Yield 2.35%
Description Info
Market Bond
Category Municipal Bond
  • Basic Materials 0.00%
  • Communication Services 0.00%
  • Consumer Cyclicals 0.00%
  • Consumer Defensive 0.00%
  • Energy 0.00%
  • Financial Services 0.00%
  • Healthcare 0.00%
  • Industrials 0.00%
  • Real Estate 0.00%
  • Technology 0.00%
  • Utilities 0.00%


Vanguard Short-Term Tax-Exempt Fund


Read More
Rating Type Rating
Expense Ratio Score 10 /10
Expense Rating 8 /10
Market Score 10 /10
Category Score 8 /10
Overview Details
Fund Type Mutual Fund
Inception Date Sep-1-1977
Exchange NMFQS
Expense Ratio 0.170%
Net Assets 16.9 Billion
Yield 1.51%
Description Info
Market Bond
Category Municipal Bond
  • Advance Refunded 5.33%
  • Cash & Equivalents 3.85%
  • Education 7.05%
  • Health 10.70%
  • Housing 2.86%
  • Industrial 1.54%
  • Miscellaneous Revenue 13.15%
  • Municipal 95.17%
  • Other 0.00%
  • State and Local General Obligation 28.56%
  • Tobacco 0.36%
  • Transportation 13.75%
  • Utilities 7.85%
  • Water & Sewer 4.04%

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