IWM vs. PABU

Last updated Jun 16, 2026

IWM (iShares Russell 2000 ETF) and PABU (iShares Paris-Aligned Climate Optimized MSCI USA ETF) are both exchange-traded funds - IWM is a Small Cap Blend Equities fund tracking the Russell 2000 Index, while PABU is a Large Cap Blend Equities fund tracking the MSCI USA Climate Paris Aligned Benchmark Extended Select PAB Index (USD). Both are passively managed. Over the past 3 years, IWM returned 17.97%/yr vs 18.02%/yr for PABU. A 0.76 correlation means they provide meaningful diversification when combined. IWM charges 0.19%/yr vs 0.10%/yr for PABU.

Performance

IWM vs. PABU - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares Russell 2000 ETF (IWM) and iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, IWM achieves a 20.19% return, which is significantly higher than PABU's 6.81% return.

IWM

• 1D: 0.82%
• 1M: 6.39%
• YTD: 20.19%
• 6M: 17.83%
• 1Y: 42.91%
• 3Y*: 17.97%
• 5Y*: 6.41%
• 10Y*: 11.40%

PABU

• 1D: 1.98%
• 1M: 1.91%
• YTD: 6.81%
• 6M: 7.83%
• 1Y: 20.95%
• 3Y*: 18.02%
• 5Y*: —
• 10Y*: —

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

IWM vs. PABU - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022
IWM iShares Russell 2000 ETF	20.19%	12.66%	11.38%	16.83%	-13.05%
PABU iShares Paris-Aligned Climate Optimized MSCI USA ETF	6.81%	13.08%	24.84%	29.51%	-15.45%

Correlation

The correlation between IWM and PABU is 0.73, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	0.73
Correlation (3Y) Calculated over the trailing 3-year period	0.74
Correlation (All Time) Calculated using the full available price history since Feb 11, 2022	0.76

The correlation between IWM and PABU has been stable across timeframes, ranging from 0.73 to 0.76 - a consistent structural relationship.

IWM vs. PABU - Sectors Allocation Comparison

Sectors	IWM	PABU
Technology	19.2%	52.1%
Industrials	17.9%	1.6%
Healthcare	16.3%	5.7%
Financial Services	15.4%	6.8%
Consumer Cyclical	7.9%	6.0%
Real Estate	5.9%	16.6%
Energy	5.4%	0.9%
Basic Materials	4.7%	0.5%
Utilities	2.7%	1.6%
Communication Services	2.5%	8.4%
Consumer Defensive	2.2%	-

Return for Risk

IWM vs. PABU — Risk / Return Rank

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

IWM

IWM Risk / Return Rank: 76
IWM Sharpe Ratio Rank: 77
IWM Sortino Ratio Rank: 75
IWM Omega Ratio Rank: 67
IWM Calmar Ratio Rank: 82
IWM Martin Ratio Rank: 79

PABU

PABU Risk / Return Rank: 40
PABU Sharpe Ratio Rank: 45
PABU Sortino Ratio Rank: 43
PABU Omega Ratio Rank: 44
PABU Calmar Ratio Rank: 33
PABU Martin Ratio Rank: 37

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.

IWM vs. PABU - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares Russell 2000 ETF (IWM) and iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU). 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.

	IWM	PABU	Difference
Sharpe ratio: Return per unit of total volatility	2.20	1.50	+0.70
Sortino ratio: Return per unit of downside risk	2.99	2.05	+0.93
Omega ratio: Gain probability vs. loss probability	1.36	1.27	+0.09
Calmar ratio: Return relative to maximum drawdown	3.91	1.57	+2.34
Martin ratio: Return relative to average drawdown	13.84	5.37	+8.46

IWM vs. PABU - Sharpe Ratio Comparison

The current IWM Sharpe Ratio is 2.20, which is higher than the PABU Sharpe Ratio of 1.50. The chart below compares the historical Sharpe Ratios of IWM and PABU, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

Drawdowns

IWM vs. PABU - Drawdown Comparison

The maximum IWM drawdown since its inception was -59.05%, which is greater than PABU's maximum drawdown of -22.76%. Use the drawdown chart below to compare losses from any high point for IWM and PABU.

Drawdown Indicators

	IWM	PABU	Difference
Max Drawdown Largest peak-to-trough decline	-59.05%	-22.76%	-36.29%
Max Drawdown (1Y) Largest decline over 1 year	-11.03%	-13.40%	+2.37%
Max Drawdown (3Y) Largest decline over 3 years	-27.50%	-20.85%	-6.65%
Max Drawdown (5Y) Largest decline over 5 years	-31.91%	—	—
Max Drawdown (10Y) Largest decline over 10 years	-41.13%	—	—
Current Drawdown Current decline from peak	0.00%	-3.61%	+3.61%
Average Drawdown Average peak-to-trough decline	-10.75%	-5.62%	-5.13%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.11%	3.91%	-0.80%

Volatility

IWM vs. PABU - Volatility Comparison

iShares Russell 2000 ETF (IWM) has a higher volatility of 7.17% compared to iShares Paris-Aligned Climate Optimized MSCI USA ETF (PABU) at 5.97%. This indicates that IWM's price experiences larger fluctuations and is considered to be riskier than PABU based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	IWM	PABU	Difference
Volatility (1M) Calculated over the trailing 1-month period	7.17%	5.97%	+1.20%
Volatility (6M) Calculated over the trailing 6-month period	14.27%	11.32%	+2.95%
Volatility (1Y) Calculated over the trailing 1-year period	19.67%	14.06%	+5.61%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.62%	18.76%	+3.86%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	23.09%	18.76%	+4.33%

IWM vs. PABU - Expense Ratio Comparison

IWM has a 0.19% expense ratio, which is higher than PABU's 0.10% 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

IWM vs. PABU - Dividend Comparison

IWM's dividend yield for the trailing twelve months is around 1.10%, which matches PABU's 1.09% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
IWM iShares Russell 2000 ETF	1.10%	1.04%	1.15%	1.35%	1.48%	0.94%	1.04%	1.26%	1.40%	1.26%	1.38%	1.54%
PABU iShares Paris-Aligned Climate Optimized MSCI USA ETF	1.09%	0.90%	1.00%	1.06%	1.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both IWM and PABU in my portfolio?

IWM and PABU have a correlation of 0.73, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, IWM or PABU?

IWM has higher volatility (7.17%) compared to PABU (5.97%). In terms of maximum drawdown, IWM dropped -59.05% vs PABU's -22.76%.

Which ETF is better, IWM or PABU?

On 3-year performance, PABU leads with 18.02% vs 17.97% for IWM. On fees, PABU is cheaper at 0.10% per year. On volatility, PABU has been the lower-risk option at 5.97%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, IWM or PABU?

Over the 3-year period, PABU has performed better with a 18.02% return vs 17.97%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, IWM or PABU?

PABU is cheaper with a 0.10% expense ratio, compared with 0.19% for IWM.

Which ETF pays a higher dividend yield, IWM or PABU?

IWM and PABU have nearly identical dividend yields, around 1.10%.

What is the main difference between IWM and PABU?

IWM is categorized as Small Cap Blend Equities, while PABU is Large Cap Blend Equities. IWM tracks Russell 2000 Index, while PABU tracks MSCI USA Climate Paris Aligned Benchmark Extended Select PAB Index (USD). Their fees differ too: 0.19% for IWM and 0.10% for PABU.

Which has better risk-adjusted returns?

IWM currently has the higher Sharpe Ratio (2.20 vs 1.50), 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.