VWITX vs VTEB (active vs passive munis)

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Topic Author
simplesauce
Posts: 318
Joined: Tue Jan 17, 2017 8:22 am

VWITX vs VTEB (active vs passive munis)

Post by simplesauce »

Hi all. I am curious what your reaction is when comparing both of these Vanguard funds. Can someone outline why their performance is so different? To my mind, both funds have similar structure and goals. Is this a case where an active manager actually can protect downside successfully? Thanks!:

(Actively managed) Vanguard Intermediate-Term Tax-Exempt
Down 5% YTD

(Passively managed) Vanguard Tax-Exempt Bond ETF
Down 14% YTD
ruud
Posts: 559
Joined: Sat Mar 03, 2007 1:28 pm
Location: san francisco bay area

Re: VWITX vs VTEB (active vs passive munis)

Post by ruud »

As far as I understand, this is due to ETF market price differing from the NAV rather than active vs. passive.

A better comparison would be the mutual fund share class of VTEB: VTEAX. It is down 5.38% YTD, compared to 5.17% for VWITX.
.
Topic Author
simplesauce
Posts: 318
Joined: Tue Jan 17, 2017 8:22 am

Re: VWITX vs VTEB (active vs passive munis)

Post by simplesauce »

Oh wow!!
ruud wrote: Fri Mar 20, 2020 11:58 am As far as I understand, this is due to ETF market price differing from the NAV rather than active vs. passive.

A better comparison would be the mutual fund share class of VTEB: VTEAX. It is down 5.38% YTD, compared to 5.17% for VWITX.
BogleBuddy12
Posts: 421
Joined: Mon May 18, 2015 4:42 pm

Re: VWITX vs VTEB (active vs passive munis)

Post by BogleBuddy12 »

I am curious if there are any further comments comparing these two funds.
User avatar
grabiner
Advisory Board
Posts: 30137
Joined: Tue Feb 20, 2007 11:58 pm
Location: Columbia, MD

Re: VWITX vs VTEB (active vs passive munis)

Post by grabiner »

BogleBuddy12 wrote: Wed Jul 21, 2021 3:26 pm I am curious if there are any further comments comparing these two funds.
Note that the original post is from March 2020, when the ETF market did not function well, and thus many ETFs (particularly those holding less liquid investments, such as municipal bonds) traded at significant premiums or discounts. Under more normal conditions, the two funds should have similar returns, since they have bonds of similar duration and quality.
Wiki David Grabiner
hudson
Posts: 4228
Joined: Fri Apr 06, 2007 9:15 am

Re: VWITX vs VTEB (active vs passive munis)

Post by hudson »

simplesauce wrote: Fri Mar 20, 2020 11:20 am Hi all. I am curious what your reaction is when comparing both of these Vanguard funds. Can someone outline why their performance is so different? To my mind, both funds have similar structure and goals. Is this a case where an active manager actually can protect downside successfully? Thanks!:

(Actively managed) Vanguard Intermediate-Term Tax-Exempt
Down 5% YTD

(Passively managed) Vanguard Tax-Exempt Bond ETF
Down 14% YTD
Old discussion.
I hold VWITX; VTEB is also good.
Bottom line: Both are OK.
Post Reply