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 10.83%/yr vs -42.79%/yr for TZA. Their -1.00 correlation means they have often moved in opposite directions in the past. 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 23.08% return, which is significantly higher than TZA's -49.07% return. Over the past 10 years, IWM has outperformed TZA with an annualized return of 10.83%, while TZA has yielded a comparatively lower -42.79% annualized return.
IWM
- 1D
- 1.85%
- 1M
- 1.39%
- 6M
- 15.29%
- YTD
- 23.08%
- 1Y
- 38.74%
- 3Y*
- 17.20%
- 5Y*
- 7.66%
- 10Y*
- 10.83%
- ALL TIME*
- 8.88%
TZA
- 1D
- -5.52%
- 1M
- -4.31%
- 6M
- -38.21%
- YTD
- -49.07%
- 1Y
- -65.42%
- 3Y*
- -43.83%
- 5Y*
- -32.60%
- 10Y*
- -42.79%
- ALL TIME*
- -49.95%
Liquidity Comparison
| Position | Avg. Volume Value (2W) | Avg. Volume Value (1M) | Avg. Volume Value (3M) |
|---|---|---|---|
| $6.85B | $6.35B | $7.43B | |
| $165.49M | $402.30M | $1.01B |
IWM vs. TZA - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IWM iShares Russell 2000 ETF | 23.08% | 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 | -49.07% | -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 have often moved in opposite directions in the past. This relationship can weaken or reverse as market conditions change.
| Correlation | |
|---|---|
Correlation (1Y) Focuses on recent behavior, but can change the most. | -1.00 |
Correlation (3Y) Balances recent behavior with more history. | -1.00 |
Correlation (5Y) Shows whether the relationship held over a longer period. | -1.00 |
Correlation (10Y) Provides a long-term view across more market conditions. | -1.00 |
Correlation (All Time) Calculated using the full available price history since Nov 19, 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.
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 | TZA | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +3.16 | ||
| Sortino ratioReturn per unit of downside risk | +4.86 | ||
| Omega ratioGain probability vs. loss probability | 1.34 | 0.78 | +0.56 |
| Calmar ratioReturn relative to maximum drawdown | 3.53 | -1.00 | +4.53 |
| Martin ratioReturn relative to average drawdown | 12.51 | -1.51 | +14.02 |
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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% | -65.42% | +54.39% |
Max Drawdown (3Y)Largest decline over 3 years | -27.50% | -89.61% | +62.11% |
Max Drawdown (5Y)Largest decline over 5 years | -31.91% | -91.82% | +59.91% |
Max Drawdown (10Y)Largest decline over 10 years | -41.13% | -99.67% | +58.54% |
Current DrawdownCurrent decline from peak | 0.00% | -100.00% | +100.00% |
Average DrawdownAverage peak-to-trough decline | -10.71% | -98.00% | +87.29% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 3.11% | 43.27% | -40.16% |
Volatility
IWM vs. TZA - Volatility Comparison
The current volatility for iShares Russell 2000 ETF (IWM) is 4.58%, while Direxion Daily Small Cap Bear 3X Shares (TZA) has a volatility of 13.58%. 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 | 4.58% | 13.58% | -9.00% |
Volatility (6M)Calculated over the trailing 6-month period | 14.21% | 42.61% | -28.40% |
Volatility (1Y)Calculated over the trailing 1-year period | 19.40% | 57.68% | -38.28% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 22.50% | 67.35% | -44.85% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 23.02% | 68.87% | -45.85% |
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 5.20% 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 | 5.20% | 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 (13.58%) compared to IWM (4.58%). In terms of maximum drawdown, IWM dropped -59.05% vs TZA's -100.00%.
On 10-year performance, IWM leads with 10.83% vs -42.79% for TZA. On fees, IWM is cheaper at 0.19% per year. On volatility, IWM has been the lower-risk option at 4.58%. 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 10.83% return vs -42.79%. 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 5.20%, 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 (2.02 vs -1.14), 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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