SCHO vs. VTES: Which Short-Term Bond ETF Is the Better Buy in 2026?
The Schwab Short-Term U.S. Treasury ETF targets government debt with lower costs and higher yields, while the Vanguard Short-Term Tax-Exempt Bond ETF offers federal tax-free municipal bond income.
Overview
The Schwab Short-Term U.S. Treasury ETF (NYSEMKT:SCHO) provides liquid exposure to government-backed debt, while the Vanguard Short-Term Tax-Exempt Bond ETF (NYSEMKT:VTES) looks better for investors seeking federal tax-free income.
These funds offer conservative exposure to short-term bonds but serve different tax purposes. SCHO focuses on highly liquid U.S. Treasury notes. At the same time, VTES targets investment-grade municipal bonds to provide income generally shielded from federal income tax and the federal alternative minimum tax.
Details
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.
Source
Originally published at www.fool.com.