IEF vs. SHY
IEF (iShares 7-10 Year Treasury Bond ETF) and SHY (iShares 1-3 Year Treasury Bond ETF) are both Government Bonds funds from iShares - IEF tracks the ICE U.S. Treasury 7-10 Year Bond Index while SHY tracks the ICE US Treasury 1-3 Year Index. Both are passively managed. Over the past 10 years, IEF returned 0.51%/yr vs 1.61%/yr for SHY. A 0.77 correlation means they provide meaningful diversification when combined. Both charge a 0.15% expense ratio.
Performance
IEF vs. SHY - Performance Comparison
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Returns By Period
In the year-to-date period, IEF achieves a -0.66% return, which is significantly lower than SHY's 0.36% return. Over the past 10 years, IEF has underperformed SHY with an annualized return of 0.51%, while SHY has yielded a comparatively higher 1.61% annualized return.
IEF
- 1D
- -0.38%
- 1M
- 0.46%
- YTD
- -0.66%
- 6M
- -0.64%
- 1Y
- 3.24%
- 3Y*
- 2.55%
- 5Y*
- -1.20%
- 10Y*
- 0.51%
SHY
- 1D
- -0.10%
- 1M
- 0.04%
- YTD
- 0.36%
- 6M
- 0.48%
- 1Y
- 2.93%
- 3Y*
- 4.07%
- 5Y*
- 1.74%
- 10Y*
- 1.61%
IEF vs. SHY - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IEF iShares 7-10 Year Treasury Bond ETF | -0.66% | 8.03% | -0.63% | 3.64% | -15.15% | -3.33% | 10.01% | 8.03% | 0.99% | 2.55% |
SHY iShares 1-3 Year Treasury Bond ETF | 0.36% | 4.95% | 3.92% | 4.16% | -3.88% | -0.71% | 3.03% | 3.38% | 1.46% | 0.26% |
Correlation
The correlation between IEF and SHY is 0.85, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.86 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.84 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.83 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.79 |
Correlation (All Time) Calculated using the full available price history since Jul 26, 2002 | 0.77 |
The correlation between IEF and SHY has been stable across timeframes, ranging from 0.77 to 0.85 - a consistent structural relationship.
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Return for Risk
IEF vs. SHY — Risk / Return Rank
IEF
SHY
IEF vs. SHY - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares 7-10 Year Treasury Bond ETF (IEF) and iShares 1-3 Year Treasury Bond ETF (SHY). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.
Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.
| IEF | SHY | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -1.45 | ||
| Sortino ratioReturn per unit of downside risk | -2.34 | ||
| Omega ratioGain probability vs. loss probability | 1.12 | 1.43 | -0.31 |
| Calmar ratioReturn relative to maximum drawdown | 0.80 | 3.31 | -2.51 |
| Martin ratioReturn relative to average drawdown | 2.17 | 12.93 | -10.76 |
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Drawdowns
IEF vs. SHY - Drawdown Comparison
The maximum IEF drawdown since its inception was -23.93%, which is greater than SHY's maximum drawdown of -5.71%. Use the drawdown chart below to compare losses from any high point for IEF and SHY.
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Drawdown Indicators
| IEF | SHY | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -23.93% | -5.71% | -18.22% |
Max Drawdown (1Y)Largest decline over 1 year | -4.07% | -0.89% | -3.18% |
Max Drawdown (3Y)Largest decline over 3 years | -7.74% | -0.97% | -6.77% |
Max Drawdown (5Y)Largest decline over 5 years | -21.40% | -5.71% | -15.69% |
Max Drawdown (10Y)Largest decline over 10 years | -23.93% | -5.71% | -18.22% |
Current DrawdownCurrent decline from peak | -11.35% | -0.38% | -10.97% |
Average DrawdownAverage peak-to-trough decline | -5.36% | -0.52% | -4.84% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.49% | 0.23% | +1.26% |
Volatility
IEF vs. SHY - Volatility Comparison
iShares 7-10 Year Treasury Bond ETF (IEF) has a higher volatility of 1.41% compared to iShares 1-3 Year Treasury Bond ETF (SHY) at 0.49%. This indicates that IEF's price experiences larger fluctuations and is considered to be riskier than SHY based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| IEF | SHY | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.41% | 0.49% | +0.92% |
Volatility (6M)Calculated over the trailing 6-month period | 3.49% | 1.01% | +2.48% |
Volatility (1Y)Calculated over the trailing 1-year period | 4.73% | 1.37% | +3.36% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 7.71% | 1.99% | +5.72% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 6.63% | 1.57% | +5.06% |
IEF vs. SHY - Expense Ratio Comparison
Both IEF and SHY have an expense ratio of 0.15%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.
Dividends
IEF vs. SHY - Dividend Comparison
IEF's dividend yield for the trailing twelve months is around 3.90%, more than SHY's 3.69% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IEF iShares 7-10 Year Treasury Bond ETF | 3.90% | 3.77% | 3.62% | 2.91% | 1.96% | 0.83% | 1.08% | 2.08% | 2.24% | 1.82% | 1.81% | 1.90% |
SHY iShares 1-3 Year Treasury Bond ETF | 3.69% | 3.81% | 3.92% | 2.99% | 1.30% | 0.26% | 0.94% | 2.12% | 1.72% | 0.98% | 0.71% | 0.54% |
Frequently Asked Questions
IEF and SHY have a correlation of 0.85, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
IEF has higher volatility (1.41%) compared to SHY (0.49%). In terms of maximum drawdown, IEF dropped -23.93% vs SHY's -5.71%.
On 10-year performance, SHY leads with 1.61% vs 0.51% for IEF. Both ETFs have the same 0.15% expense ratio. On volatility, SHY has been the lower-risk option at 0.49%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, SHY has performed better with a 1.61% return vs 0.51%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
IEF and SHY have the same expense ratio: 0.15% per year.
IEF has the higher dividend yield at 3.90%, compared with 3.69% for SHY.
IEF tracks ICE U.S. Treasury 7-10 Year Bond Index, while SHY tracks ICE US Treasury 1-3 Year Index.
SHY currently has the higher Sharpe Ratio (2.14 vs 0.69), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.
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