IEI vs. SCHO

Last updated Jun 4, 2026

IEI (iShares 3-7 Year Treasury Bond ETF) and SCHO (Schwab Short-Term U.S. Treasury ETF) are both Government Bonds funds - IEI tracks the ICE U.S. Treasury 3-7 Year Bond Index while SCHO tracks the Bloomberg U.S. Treasury 1-3 Year Index. Both are passively managed. Over the past 10 years, IEI returned 1.28%/yr vs 1.71%/yr for SCHO. A 0.80 correlation means they provide meaningful diversification when combined. IEI charges 0.15%/yr vs 0.03%/yr for SCHO.

Performance

IEI vs. SCHO - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares 3-7 Year Treasury Bond ETF (IEI) and Schwab Short-Term U.S. Treasury ETF (SCHO). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, IEI achieves a -0.42% return, which is significantly lower than SCHO's 0.42% return. Over the past 10 years, IEI has underperformed SCHO with an annualized return of 1.28%, while SCHO has yielded a comparatively higher 1.71% annualized return.

IEI

• 1D: -0.13%
• 1M: -0.17%
• YTD: -0.42%
• 6M: -0.49%
• 1Y: 3.28%
• 3Y*: 3.52%
• 5Y*: 0.23%
• 10Y*: 1.28%

SCHO

• 1D: -0.04%
• 1M: 0.06%
• YTD: 0.42%
• 6M: 0.78%
• 1Y: 3.39%
• 3Y*: 4.15%
• 5Y*: 1.80%
• 10Y*: 1.71%

*Multi-year figures are annualized to reflect compound growth (CAGR)

IEI vs. SCHO - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
IEI iShares 3-7 Year Treasury Bond ETF	-0.42%	6.96%	1.81%	4.42%	-9.51%	-2.54%	6.95%	5.71%	1.36%	1.22%
SCHO Schwab Short-Term U.S. Treasury ETF	0.42%	5.49%	3.65%	4.31%	-3.87%	-0.64%	3.11%	3.47%	1.37%	0.33%

Correlation

The correlation between IEI and SCHO 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	0.85
Correlation (3Y) Calculated over the trailing 3-year period	0.89
Correlation (5Y) Calculated over the trailing 5-year period	0.89
Correlation (10Y) Calculated over the trailing 10-year period	0.84
Correlation (All Time) Calculated using the full available price history since Aug 6, 2010	0.80

The correlation between IEI and SCHO has been stable across timeframes, ranging from 0.80 to 0.89 - a consistent structural relationship.

Return for Risk

IEI vs. SCHO — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.

IEI

IEI Risk / Return Rank: 28
IEI Sharpe Ratio Rank: 29
IEI Sortino Ratio Rank: 30
IEI Omega Ratio Rank: 27
IEI Calmar Ratio Rank: 27
IEI Martin Ratio Rank: 27

SCHO

SCHO Risk / Return Rank: 81
SCHO Sharpe Ratio Rank: 74
SCHO Sortino Ratio Rank: 88
SCHO Omega Ratio Rank: 81
SCHO Calmar Ratio Rank: 77
SCHO Martin Ratio Rank: 83

The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

IEI vs. SCHO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares 3-7 Year Treasury Bond ETF (IEI) and Schwab Short-Term U.S. Treasury ETF (SCHO). 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.

	IEI	SCHO	Difference
Sharpe ratio Return per unit of total volatility	1.09	2.48	-1.40
Sortino ratio Return per unit of downside risk	1.65	4.06	-2.41
Omega ratio Gain probability vs. loss probability	1.19	1.50	-0.31
Calmar ratio Return relative to maximum drawdown	1.32	3.96	-2.64
Martin ratio Return relative to average drawdown	3.96	17.03	-13.07
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

IEI vs. SCHO - Sharpe Ratio Comparison

The current IEI Sharpe Ratio is 1.09, which is lower than the SCHO Sharpe Ratio of 2.48. The chart below compares the historical Sharpe Ratios of IEI and SCHO, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Sharpe Ratios by Period

	IEI	SCHO	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	1.09	2.48	-1.40
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.05	0.91	-0.87
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.33	1.10	-0.78
Sharpe Ratio (All Time) Calculated using the full available price history	0.70	0.99	-0.30

Drawdowns

IEI vs. SCHO - Drawdown Comparison

The maximum IEI drawdown since its inception was -14.60%, which is greater than SCHO's maximum drawdown of -5.69%. Use the drawdown chart below to compare losses from any high point for IEI and SCHO.

Drawdown Indicators

	IEI	SCHO	Difference
Max Drawdown Largest peak-to-trough decline	-14.60%	-5.69%	-8.91%
Max Drawdown (1Y) Largest decline over 1 year	-2.50%	-0.86%	-1.64%
Max Drawdown (3Y) Largest decline over 3 years	-3.66%	-0.98%	-2.68%
Max Drawdown (5Y) Largest decline over 5 years	-13.88%	-5.69%	-8.19%
Max Drawdown (10Y) Largest decline over 10 years	-14.60%	-5.69%	-8.91%
Current Drawdown Current decline from peak	-1.85%	-0.27%	-1.58%
Average Drawdown Average peak-to-trough decline	-2.67%	-0.61%	-2.06%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.83%	0.20%	+0.63%

Volatility

IEI vs. SCHO - Volatility Comparison

iShares 3-7 Year Treasury Bond ETF (IEI) has a higher volatility of 0.91% compared to Schwab Short-Term U.S. Treasury ETF (SCHO) at 0.41%. This indicates that IEI's price experiences larger fluctuations and is considered to be riskier than SCHO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	IEI	SCHO	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.91%	0.41%	+0.50%
Volatility (6M) Calculated over the trailing 6-month period	2.13%	0.90%	+1.23%
Volatility (1Y) Calculated over the trailing 1-year period	3.04%	1.37%	+1.67%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	4.77%	1.98%	+2.79%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	3.93%	1.56%	+2.37%

IEI vs. SCHO - Expense Ratio Comparison

IEI has a 0.15% expense ratio, which is higher than SCHO's 0.03% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

IEI vs. SCHO - Dividend Comparison

IEI's dividend yield for the trailing twelve months is around 3.64%, less than SCHO's 3.91% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
IEI iShares 3-7 Year Treasury Bond ETF	3.64%	3.48%	3.18%	2.36%	1.37%	0.73%	1.12%	2.01%	1.95%	1.51%	1.33%	1.39%
SCHO Schwab Short-Term U.S. Treasury ETF	3.91%	4.06%	4.29%	3.76%	1.34%	0.41%	1.27%	2.27%	1.60%	1.12%	0.82%	0.68%

Frequently Asked Questions

Can I hold both IEI and SCHO in my portfolio?

IEI and SCHO 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.

Which is riskier, IEI or SCHO?

IEI has higher volatility (0.91%) compared to SCHO (0.41%). In terms of maximum drawdown, IEI dropped -14.60% vs SCHO's -5.69%.

Which ETF is better, IEI or SCHO?

On 10-year performance, SCHO leads with 1.71% vs 1.28% for IEI. On fees, SCHO is cheaper at 0.03% per year. On volatility, SCHO has been the lower-risk option at 0.41%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, IEI or SCHO?

Over the 10-year period, SCHO has performed better with a 1.71% return vs 1.28%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, IEI or SCHO?

SCHO is cheaper with a 0.03% expense ratio, compared with 0.15% for IEI.

Which ETF pays a higher dividend yield, IEI or SCHO?

SCHO has the higher dividend yield at 3.91%, compared with 3.64% for IEI.

What is the main difference between IEI and SCHO?

IEI tracks ICE U.S. Treasury 3-7 Year Bond Index, while SCHO tracks Bloomberg U.S. Treasury 1-3 Year Index. They also come from different issuers: iShares and Charles Schwab. Their fees differ too: 0.15% for IEI and 0.03% for SCHO.

Which has better risk-adjusted returns?

SCHO currently has the higher Sharpe Ratio (2.48 vs 1.09), 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.