AMUN vs VTES

AMUNBabrdn Ultra Short Municipal Income Active ETF

VTESAVanguard Short-Term Tax-Exempt Bond ETF

In short

AMUN Ultra-short munis run by an active desk instead of an index, under a strategy whose track record dates to 1986. The aim: high after-tax income with capital preservation, paid out monthly.

VTES Vanguard's muni ETF on a short leash: an AMT-free tax-exempt index, but capped at seven years to trim interest-rate sensitivity. Five basis points, roughly 2,700 bonds, income paid monthly.

Stated mandate

AMUN The fund seeks high after-tax current income while preserving capital.

VTES The Fund seeks to track an index representing investment-grade U.S. municipal bonds with remaining maturities from one month through seven years.

Why people hold it

• AMUN A human desk picks the bonds and sets duration here, rather than mirroring a muni index. The stated job: high after-tax current income while preserving capital.
• 0.25% net of a waiver running through February 28, 2028, versus a 0.74% gross fee, and near what short-muni funds typically charge.
• Income lands monthly, and the portfolio stays inside its lane: US municipal bonds at the ultra-short end of the curve.

• VTES Costs 0.05% a year, a fraction of what the typical muni-bond fund in its category charges. One of the cheapest ways into tax-exempt bonds.
• Maturities run one month to seven years, so the portfolio moves less on rate swings than long-dated muni funds. Short duration is the whole point here.vanguard.com
• The index is AMT-free national investment-grade munis, so interest is federally tax-exempt and not caught by the alternative minimum tax.vanguard.com
• Roughly 2,700 bonds via index sampling, run by Vanguard's fixed income group, with distributions paid monthly. It tracks its benchmark closely.vanguard.com

Worth knowing

• AMUN Cheaper index options sit on the same shelf, like VTES at 0.05% and SUB at 0.07%. Active management is what the extra cost buys.
• Thinly traded and small by category standards, so limit orders matter and spreads can be wider than at the big index funds.
• Capital preservation is the goal, not a promise: muni credit and rate moves still move the price, and the waiver is scheduled to end.

• VTES Short maturities cut both ways. Vanguard's own materials describe moderate current income, the trade-off for less rate sensitivity than longer muni portfolios.vanguard.com
• It's a national fund, so it isn't structured to shelter state income tax the way single-state muni ETFs such as NYF are.
• Launched in 2023, it has a shorter live record than muni ETFs that have been trading for over a decade, including its broader sibling VTEB.

Full AMUN profile⁠

Full VTES profile⁠