IWM vs. TZA
IWM (iShares Russell 2000 ETF) and TZA (Direxion Daily Small Cap Bear 3X Shares) are both exchange-traded funds - IWM is a Small Cap Blend Equities fund tracking the Russell 2000 Index, while TZA is a Leveraged Equities fund tracking the Russell 2000 Index (-300%). Both are passively managed. Over the past 10 years, IWM returned 10.93%/yr vs -43.15%/yr for TZA. At a correlation of -1.00, they often move in opposite directions. IWM charges 0.19%/yr vs 1.11%/yr for TZA.
Performance
IWM vs. TZA - Performance Comparison
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Returns By Period
In the year-to-date period, IWM achieves a 17.07% return, which is significantly higher than TZA's -40.43% return. Over the past 10 years, IWM has outperformed TZA with an annualized return of 10.93%, while TZA has yielded a comparatively lower -43.15% annualized return.
IWM
- 1D
- -1.37%
- 1M
- 3.52%
- YTD
- 17.07%
- 6M
- 15.83%
- 1Y
- 39.10%
- 3Y*
- 17.88%
- 5Y*
- 6.11%
- 10Y*
- 10.93%
TZA
- 1D
- 3.75%
- 1M
- -10.87%
- YTD
- -40.43%
- 6M
- -38.50%
- 1Y
- -65.59%
- 3Y*
- -44.69%
- 5Y*
- -30.11%
- 10Y*
- -43.15%
IWM vs. TZA - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IWM iShares Russell 2000 ETF | 17.07% | 12.66% | 11.38% | 16.83% | -20.48% | 14.54% | 20.03% | 25.39% | -11.12% | 14.58% |
TZA Direxion Daily Small Cap Bear 3X Shares | -40.43% | -40.22% | -32.22% | -41.19% | 30.21% | -50.80% | -80.43% | -53.25% | 25.06% | -38.19% |
Correlation
The correlation between IWM and TZA is -1.00, 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 | -1.00 |
Correlation (3Y) Calculated over the trailing 3-year period | -1.00 |
Correlation (5Y) Calculated over the trailing 5-year period | -1.00 |
Correlation (10Y) Calculated over the trailing 10-year period | -1.00 |
Correlation (All Time) Calculated using the full available price history since Nov 20, 2008 | -1.00 |
The correlation between IWM and TZA has been stable across timeframes, ranging from -1.00 to -1.00 - a consistent structural relationship.
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Return for Risk
IWM vs. TZA — Risk / Return Rank
IWM
TZA
IWM vs. TZA - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares Russell 2000 ETF (IWM) and Direxion Daily Small Cap Bear 3X Shares (TZA). 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.
| IWM | TZA | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +3.21 | ||
| Sortino ratioReturn per unit of downside risk | +4.93 | ||
| Omega ratioGain probability vs. loss probability | 1.34 | 0.78 | +0.56 |
| Calmar ratioReturn relative to maximum drawdown | 3.56 | -0.98 | +4.54 |
| Martin ratioReturn relative to average drawdown | 12.64 | -1.51 | +14.15 |
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month. | |||
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Sharpe Ratios by Period
| IWM | TZA | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 2.05 | -1.16 | +3.21 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.27 | -0.45 | +0.72 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.48 | -0.63 | +1.10 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.37 | -0.71 | +1.08 |
Drawdowns
IWM vs. TZA - Drawdown Comparison
The maximum IWM drawdown since its inception was -59.05%, smaller than the maximum TZA drawdown of -100.00%. Use the drawdown chart below to compare losses from any high point for IWM and TZA.
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Drawdown Indicators
| IWM | TZA | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -59.05% | -100.00% | +40.95% |
Max Drawdown (1Y)Largest decline over 1 year | -11.03% | -67.28% | +56.25% |
Max Drawdown (3Y)Largest decline over 3 years | -27.50% | -88.34% | +60.84% |
Max Drawdown (5Y)Largest decline over 5 years | -31.91% | -90.83% | +58.92% |
Max Drawdown (10Y)Largest decline over 10 years | -41.13% | -99.71% | +58.58% |
Current DrawdownCurrent decline from peak | -1.49% | -100.00% | +98.51% |
Average DrawdownAverage peak-to-trough decline | -10.77% | -98.00% | +87.23% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 3.10% | 43.51% | -40.41% |
Volatility
IWM vs. TZA - Volatility Comparison
The current volatility for iShares Russell 2000 ETF (IWM) is 5.75%, while Direxion Daily Small Cap Bear 3X Shares (TZA) has a volatility of 17.03%. This indicates that IWM experiences smaller price fluctuations and is considered to be less risky than TZA based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| IWM | TZA | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 5.75% | 17.03% | -11.28% |
Volatility (6M)Calculated over the trailing 6-month period | 13.53% | 40.64% | -27.11% |
Volatility (1Y)Calculated over the trailing 1-year period | 19.20% | 57.05% | -37.85% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 22.52% | 67.43% | -44.91% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 23.04% | 68.91% | -45.87% |
IWM vs. TZA - Expense Ratio Comparison
IWM has a 0.19% expense ratio, which is lower than TZA's 1.11% expense ratio.
Dividends
IWM vs. TZA - Dividend Comparison
IWM's dividend yield for the trailing twelve months is around 0.88%, less than TZA's 4.82% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IWM iShares Russell 2000 ETF | 0.88% | 1.04% | 1.15% | 1.35% | 1.48% | 0.94% | 1.04% | 1.26% | 1.40% | 1.26% | 1.38% | 1.54% |
TZA Direxion Daily Small Cap Bear 3X Shares | 4.82% | 5.08% | 5.40% | 5.49% | 0.00% | 0.00% | 1.21% | 1.56% | 0.63% | 0.00% | 0.00% | 0.00% |
Frequently Asked Questions
IWM and TZA have a correlation of -1.00, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
TZA has higher volatility (17.03%) compared to IWM (5.75%). In terms of maximum drawdown, IWM dropped -59.05% vs TZA's -100.00%.
On 10-year performance, IWM leads with 10.93% vs -43.15% for TZA. On fees, IWM is cheaper at 0.19% per year. On volatility, IWM has been the lower-risk option at 5.75%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, IWM has performed better with a 10.93% return vs -43.15%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
IWM is cheaper with a 0.19% expense ratio, compared with 1.11% for TZA.
TZA has the higher dividend yield at 4.82%, compared with 0.88% for IWM.
IWM is categorized as Small Cap Blend Equities, while TZA is Leveraged Equities. IWM tracks Russell 2000 Index, while TZA tracks Russell 2000 Index (-300%). They also come from different issuers: iShares and Direxion. Their fees differ too: 0.19% for IWM and 1.11% for TZA.
IWM currently has the higher Sharpe Ratio (2.05 vs -1.16), 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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