ITB vs. FAAR
ITB (iShares U.S. Home Construction ETF) and FAAR (First Trust Alternative Absolute Return Strategy ETF) are both exchange-traded funds - ITB is a Building & Construction fund tracking the Dow Jones U.S. Select Home Construction Index, while FAAR is a Commodities fund actively managed by First Trust. ITB is passively managed, while FAAR is actively managed. Over the past 10 years, ITB returned 14.54%/yr vs 4.79%/yr for FAAR. At a correlation of -0.01, they often move in opposite directions. ITB charges 0.38%/yr vs 0.95%/yr for FAAR.
Performance
ITB vs. FAAR - Performance Comparison
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Returns By Period
In the year-to-date period, ITB achieves a 1.44% return, which is significantly lower than FAAR's 20.23% return. Over the past 10 years, ITB has outperformed FAAR with an annualized return of 14.54%, while FAAR has yielded a comparatively lower 4.79% annualized return.
ITB
- 1D
- -1.92%
- 1M
- 7.18%
- YTD
- 1.44%
- 6M
- -0.10%
- 1Y
- 9.29%
- 3Y*
- 6.76%
- 5Y*
- 8.38%
- 10Y*
- 14.54%
FAAR
- 1D
- -0.05%
- 1M
- -4.34%
- YTD
- 20.23%
- 6M
- 19.92%
- 1Y
- 26.86%
- 3Y*
- 10.91%
- 5Y*
- 7.89%
- 10Y*
- 4.79%
ITB vs. FAAR - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
ITB iShares U.S. Home Construction ETF | 1.44% | -5.26% | 2.06% | 68.91% | -26.26% | 49.25% | 26.42% | 48.70% | -30.92% | 59.65% |
FAAR First Trust Alternative Absolute Return Strategy ETF | 20.23% | 8.07% | 5.97% | -5.63% | 10.15% | 12.34% | 8.60% | -1.28% | -9.17% | 5.00% |
Correlation
The correlation between ITB and FAAR is -0.16, meaning they tend to move in opposite directions. This is especially valuable for risk management - when one declines, the other has historically tended to hold steady or rise.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | -0.16 |
Correlation (3Y) Calculated over the trailing 3-year period | -0.06 |
Correlation (5Y) Calculated over the trailing 5-year period | -0.05 |
Correlation (10Y) Calculated over the trailing 10-year period | -0.01 |
Correlation (All Time) Calculated using the full available price history since May 23, 2016 | -0.01 |
The correlation between ITB and FAAR shifts across timeframes, from -0.16 (1 year) to -0.01 (10 years), reflecting how their relationship changes across market environments.
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Return for Risk
ITB vs. FAAR — Risk / Return Rank
ITB
FAAR
ITB vs. FAAR - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares U.S. Home Construction ETF (ITB) and First Trust Alternative Absolute Return Strategy ETF (FAAR). 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.
| ITB | FAAR | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -1.71 | ||
| Sortino ratioReturn per unit of downside risk | -2.15 | ||
| Omega ratioGain probability vs. loss probability | 1.08 | 1.35 | -0.27 |
| Calmar ratioReturn relative to maximum drawdown | 0.36 | 4.75 | -4.39 |
| Martin ratioReturn relative to average drawdown | 0.68 | 14.70 | -14.01 |
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Drawdowns
ITB vs. FAAR - Drawdown Comparison
The maximum ITB drawdown since its inception was -86.53%, which is greater than FAAR's maximum drawdown of -18.03%. Use the drawdown chart below to compare losses from any high point for ITB and FAAR.
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Drawdown Indicators
| ITB | FAAR | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -86.53% | -18.03% | -68.50% |
Max Drawdown (1Y)Largest decline over 1 year | -26.04% | -5.68% | -20.36% |
Max Drawdown (3Y)Largest decline over 3 years | -33.35% | -11.54% | -21.81% |
Max Drawdown (5Y)Largest decline over 5 years | -40.55% | -18.03% | -22.52% |
Max Drawdown (10Y)Largest decline over 10 years | -52.10% | -18.03% | -34.07% |
Current DrawdownCurrent decline from peak | -23.10% | -5.43% | -17.67% |
Average DrawdownAverage peak-to-trough decline | -37.06% | -7.82% | -29.24% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 13.64% | 1.89% | +11.75% |
Volatility
ITB vs. FAAR - Volatility Comparison
iShares U.S. Home Construction ETF (ITB) has a higher volatility of 8.66% compared to First Trust Alternative Absolute Return Strategy ETF (FAAR) at 2.47%. This indicates that ITB's price experiences larger fluctuations and is considered to be riskier than FAAR based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| ITB | FAAR | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 8.66% | 2.47% | +6.19% |
Volatility (6M)Calculated over the trailing 6-month period | 21.41% | 9.68% | +11.73% |
Volatility (1Y)Calculated over the trailing 1-year period | 30.00% | 13.37% | +16.63% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 29.37% | 12.95% | +16.42% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 30.10% | 11.53% | +18.57% |
ITB vs. FAAR - Expense Ratio Comparison
ITB has a 0.38% expense ratio, which is lower than FAAR's 0.95% expense ratio.
Dividends
ITB vs. FAAR - Dividend Comparison
ITB's dividend yield for the trailing twelve months is around 0.66%, less than FAAR's 9.57% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
FAAR First Trust Alternative Absolute Return Strategy ETF | 9.57% | 11.63% | 3.45% | 3.20% | 5.82% | 6.49% | 3.05% | 1.02% | 0.58% | 2.83% | 0.00% | 0.00% |
ITB iShares U.S. Home Construction ETF | 0.66% | 1.67% | 0.46% | 0.48% | 0.86% | 0.37% | 0.46% | 0.50% | 0.63% | 0.28% | 0.43% | 0.34% |
Frequently Asked Questions
ITB and FAAR have a correlation of -0.16, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
ITB has higher volatility (8.66%) compared to FAAR (2.47%). In terms of maximum drawdown, ITB dropped -86.53% vs FAAR's -18.03%.
On 10-year performance, ITB leads with 14.54% vs 4.79% for FAAR. On fees, ITB is cheaper at 0.38% per year. On volatility, FAAR has been the lower-risk option at 2.47%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, ITB has performed better with a 14.54% return vs 4.79%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
ITB is cheaper with a 0.38% expense ratio, compared with 0.95% for FAAR.
FAAR has the higher dividend yield at 9.57%, compared with 0.66% for ITB.
ITB is categorized as Building & Construction, while FAAR is Commodities. They also come from different issuers: iShares and First Trust. Their fees differ too: 0.38% for ITB and 0.95% for FAAR.
FAAR currently has the higher Sharpe Ratio (2.02 vs 0.31), 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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