MUB Outpaced VGIT Over the Past Year
Investor tax bracket determines whether municipal tax‑exempt income or U.S. Treasury backing yields higher after‑tax returns.
Overview
- Latest fund data through June 17, 2026 show iShares MUB delivered a one‑year total return of 6.10% versus Vanguard VGIT's 3.10%, and MUB also led on five‑year total growth.
- VGIT reports a higher raw trailing‑12‑month distribution yield of 3.90% compared with MUB's 3.20%, so taxable investors may prefer VGIT for nominal income.
- Fee differences are small but measurable with VGIT charging a 0.03% expense ratio and MUB charging 0.05%, affecting net returns over time for large portfolios.
- The funds differ in composition and credit exposure: MUB holds more than 6,300 municipal issues that spread issuer risk while VGIT concentrates in roughly 76 U.S. Treasury notes that carry full federal backing and strong liquidity.
- For individual investors the choice hinges on after‑tax income needs and risk tolerance because municipal interest is generally exempt from federal tax while Treasury interest is federally taxable and backed by the U.S. government.