IYM vs. FXZ

Last updated Jun 5, 2026

IYM (iShares U.S. Basic Materials ETF) and FXZ (First Trust Materials AlphaDEX Fund) are both Materials funds - IYM tracks the Dow Jones U.S. Basic Materials Index while FXZ tracks the StrataQuant Materials Index. Both are passively managed. Over the past 10 years, IYM returned 10.92%/yr vs 11.59%/yr for FXZ. Their correlation of 0.91 suggests significant overlap in exposure. IYM charges 0.42%/yr vs 0.67%/yr for FXZ.

Performance

IYM vs. FXZ - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares U.S. Basic Materials ETF (IYM) and First Trust Materials AlphaDEX Fund (FXZ). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, IYM achieves a 22.18% return, which is significantly lower than FXZ's 29.58% return. Over the past 10 years, IYM has underperformed FXZ with an annualized return of 10.92%, while FXZ has yielded a comparatively higher 11.59% annualized return.

IYM

• 1D: 0.10%
• 1M: 3.09%
• YTD: 22.18%
• 6M: 27.03%
• 1Y: 37.82%
• 3Y*: 16.01%
• 5Y*: 7.84%
• 10Y*: 10.92%

FXZ

• 1D: -0.04%
• 1M: 3.76%
• YTD: 29.58%
• 6M: 33.83%
• 1Y: 52.87%
• 3Y*: 13.19%
• 5Y*: 7.83%
• 10Y*: 11.59%

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

IYM vs. FXZ - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
IYM iShares U.S. Basic Materials ETF	22.18%	20.41%	-4.54%	12.83%	-9.15%	25.62%	17.87%	19.22%	-16.63%	24.83%
FXZ First Trust Materials AlphaDEX Fund	29.58%	16.25%	-16.31%	16.27%	-0.92%	30.84%	22.52%	21.52%	-22.62%	23.72%

Correlation

The correlation between IYM and FXZ is 0.94, 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	0.94
Correlation (3Y) Calculated over the trailing 3-year period	0.94
Correlation (5Y) Calculated over the trailing 5-year period	0.95
Correlation (10Y) Calculated over the trailing 10-year period	0.94
Correlation (All Time) Calculated using the full available price history since May 11, 2007	0.91

The correlation between IYM and FXZ has been stable across timeframes, ranging from 0.91 to 0.95 - a consistent structural relationship.

IYM vs. FXZ - Sectors Allocation Comparison

Sectors	IYM	FXZ
Basic Materials	85.4%	75.7%
Industrials	11.4%	20.4%
Consumer Cyclical	3.2%	3.9%
Communication Services	-	-
Consumer Defensive	-	-
Energy	-	-
Financial Services	-	-
Healthcare	-	-
Real Estate	-	-
Technology	-	-
Utilities	-	-

Return for Risk

IYM vs. FXZ — Risk / Return Rank

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

IYM

IYM Risk / Return Rank: 59
IYM Sharpe Ratio Rank: 62
IYM Sortino Ratio Rank: 58
IYM Omega Ratio Rank: 56
IYM Calmar Ratio Rank: 58
IYM Martin Ratio Rank: 60

FXZ

FXZ Risk / Return Rank: 75
FXZ Sharpe Ratio Rank: 76
FXZ Sortino Ratio Rank: 72
FXZ Omega Ratio Rank: 68
FXZ Calmar Ratio Rank: 81
FXZ Martin Ratio Rank: 80

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.

IYM vs. FXZ - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares U.S. Basic Materials ETF (IYM) and First Trust Materials AlphaDEX Fund (FXZ). 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.

	IYM	FXZ	Difference
Sharpe ratio: Return per unit of total volatility	2.04	2.43	-0.39
Sortino ratio: Return per unit of downside risk	2.71	3.19	-0.48
Omega ratio: Gain probability vs. loss probability	1.34	1.40	-0.06
Calmar ratio: Return relative to maximum drawdown	2.79	4.17	-1.38
Martin ratio: Return relative to average drawdown	10.62	15.67	-5.05
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

IYM vs. FXZ - Sharpe Ratio Comparison

The current IYM Sharpe Ratio is 2.04, which is comparable to the FXZ Sharpe Ratio of 2.43. The chart below compares the historical Sharpe Ratios of IYM and FXZ, 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

	IYM	FXZ	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	2.04	2.43	-0.39
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.39	0.33	+0.06
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.50	0.47	+0.04
Sharpe Ratio (All Time) Calculated using the full available price history	0.34	0.35	-0.01

Drawdowns

IYM vs. FXZ - Drawdown Comparison

The maximum IYM drawdown since its inception was -67.78%, roughly equal to the maximum FXZ drawdown of -65.46%. Use the drawdown chart below to compare losses from any high point for IYM and FXZ.

Drawdown Indicators

	IYM	FXZ	Difference
Max Drawdown Largest peak-to-trough decline	-67.78%	-65.46%	-2.32%
Max Drawdown (1Y) Largest decline over 1 year	-13.61%	-12.75%	-0.86%
Max Drawdown (3Y) Largest decline over 3 years	-23.62%	-33.99%	+10.37%
Max Drawdown (5Y) Largest decline over 5 years	-29.94%	-33.99%	+4.05%
Max Drawdown (10Y) Largest decline over 10 years	-42.76%	-49.41%	+6.65%
Current Drawdown Current decline from peak	-0.78%	-0.44%	-0.34%
Average Drawdown Average peak-to-trough decline	-11.45%	-11.35%	-0.10%
Ulcer Index Depth and duration of drawdowns from previous peaks	3.57%	3.38%	+0.19%

Volatility

IYM vs. FXZ - Volatility Comparison

The current volatility for iShares U.S. Basic Materials ETF (IYM) is 6.34%, while First Trust Materials AlphaDEX Fund (FXZ) has a volatility of 6.85%. This indicates that IYM experiences smaller price fluctuations and is considered to be less risky than FXZ based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	IYM	FXZ	Difference
Volatility (1M) Calculated over the trailing 1-month period	6.34%	6.85%	-0.51%
Volatility (6M) Calculated over the trailing 6-month period	14.85%	16.38%	-1.53%
Volatility (1Y) Calculated over the trailing 1-year period	18.64%	21.84%	-3.20%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	20.37%	24.13%	-3.76%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	21.70%	24.87%	-3.17%

IYM vs. FXZ - Expense Ratio Comparison

IYM has a 0.42% expense ratio, which is lower than FXZ's 0.67% expense ratio.

Dividends

IYM vs. FXZ - Dividend Comparison

IYM's dividend yield for the trailing twelve months is around 1.24%, less than FXZ's 1.38% yield.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
FXZ First Trust Materials AlphaDEX Fund	1.38%	1.74%	1.81%	1.97%	1.56%	1.11%	1.51%	1.58%	1.38%	1.01%	1.19%	1.26%
IYM iShares U.S. Basic Materials ETF	1.24%	1.51%	1.65%	1.77%	2.14%	1.48%	1.39%	2.08%	1.68%	1.43%	1.47%	2.04%

Frequently Asked Questions

Can I hold both IYM and FXZ in my portfolio?

With a correlation of 0.94, IYM and FXZ move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.

Which is riskier, IYM or FXZ?

FXZ has higher volatility (6.85%) compared to IYM (6.34%). In terms of maximum drawdown, IYM dropped -67.78% vs FXZ's -65.46%.

Which ETF is better, IYM or FXZ?

On 10-year performance, FXZ leads with 11.59% vs 10.92% for IYM. On fees, IYM is cheaper at 0.42% per year. On volatility, IYM has been the lower-risk option at 6.34%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, IYM or FXZ?

Over the 10-year period, FXZ has performed better with a 11.59% return vs 10.92%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, IYM or FXZ?

IYM is cheaper with a 0.42% expense ratio, compared with 0.67% for FXZ.

Which ETF pays a higher dividend yield, IYM or FXZ?

FXZ has the higher dividend yield at 1.38%, compared with 1.24% for IYM.

What is the main difference between IYM and FXZ?

IYM tracks Dow Jones U.S. Basic Materials Index, while FXZ tracks StrataQuant Materials Index. They also come from different issuers: iShares and First Trust. Their fees differ too: 0.42% for IYM and 0.67% for FXZ.

Which has better risk-adjusted returns?

FXZ currently has the higher Sharpe Ratio (2.43 vs 2.04), 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.