MBSD vs. SMBS
MBSD (FlexShares Disciplined Duration MBS Index Fund) and SMBS (Schwab Mortgage-Backed Securities ETF) are both Mortgage Backed Securities funds - MBSD tracks the ICE BofA Constrained Duration US Mortgage Backed Securities while SMBS tracks the Bloomberg US MBS Float Adjusted Total Return Index. Both are passively managed. Over the past year, MBSD returned 5.26% vs 6.78% for SMBS. Their correlation of 0.87 suggests significant overlap in exposure. MBSD charges 0.20%/yr vs 0.03%/yr for SMBS.
Performance
MBSD vs. SMBS - Performance Comparison
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Returns By Period
In the year-to-date period, MBSD achieves a 0.42% return, which is significantly lower than SMBS's 0.70% return.
MBSD
- 1D
- -0.22%
- 1M
- 0.16%
- YTD
- 0.42%
- 6M
- 0.52%
- 1Y
- 5.26%
- 3Y*
- 4.31%
- 5Y*
- 0.62%
- 10Y*
- 1.37%
SMBS
- 1D
- -0.24%
- 1M
- 0.33%
- YTD
- 0.70%
- 6M
- 0.82%
- 1Y
- 6.78%
- 3Y*
- —
- 5Y*
- —
- 10Y*
- —
MBSD vs. SMBS - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | |
|---|---|---|---|
MBSD FlexShares Disciplined Duration MBS Index Fund | 0.42% | 7.12% | 0.10% |
SMBS Schwab Mortgage-Backed Securities ETF | 0.70% | 8.15% | -0.07% |
Correlation
The correlation between MBSD and SMBS is 0.84, 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 | 0.84 |
Correlation (All Time) Calculated using the full available price history since Nov 20, 2024 | 0.87 |
The correlation between MBSD and SMBS has been stable across timeframes, ranging from 0.84 to 0.87 - a consistent structural relationship.
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Return for Risk
MBSD vs. SMBS — Risk / Return Rank
MBSD
SMBS
MBSD vs. SMBS - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for FlexShares Disciplined Duration MBS Index Fund (MBSD) and Schwab Mortgage-Backed Securities ETF (SMBS). 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.
| MBSD | SMBS | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.14 | ||
| Sortino ratioReturn per unit of downside risk | -0.20 | ||
| Omega ratioGain probability vs. loss probability | 1.27 | 1.30 | -0.03 |
| Calmar ratioReturn relative to maximum drawdown | 2.43 | 2.41 | +0.02 |
| Martin ratioReturn relative to average drawdown | 7.71 | 8.21 | -0.50 |
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
| MBSD | SMBS | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 1.50 | 1.64 | -0.14 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.12 | — | — |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.32 | — | — |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.38 | 1.18 | -0.80 |
Drawdowns
MBSD vs. SMBS - Drawdown Comparison
The maximum MBSD drawdown since its inception was -14.36%, which is greater than SMBS's maximum drawdown of -3.20%. Use the drawdown chart below to compare losses from any high point for MBSD and SMBS.
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Drawdown Indicators
| MBSD | SMBS | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -14.36% | -3.20% | -11.16% |
Max Drawdown (1Y)Largest decline over 1 year | -2.17% | -2.83% | +0.66% |
Max Drawdown (3Y)Largest decline over 3 years | -4.68% | — | — |
Max Drawdown (5Y)Largest decline over 5 years | -14.10% | — | — |
Max Drawdown (10Y)Largest decline over 10 years | -14.36% | — | — |
Current DrawdownCurrent decline from peak | -1.19% | -1.33% | +0.14% |
Average DrawdownAverage peak-to-trough decline | -2.81% | -0.84% | -1.97% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.68% | 0.83% | -0.15% |
Volatility
MBSD vs. SMBS - Volatility Comparison
The current volatility for FlexShares Disciplined Duration MBS Index Fund (MBSD) is 1.15%, while Schwab Mortgage-Backed Securities ETF (SMBS) has a volatility of 1.55%. This indicates that MBSD experiences smaller price fluctuations and is considered to be less risky than SMBS based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| MBSD | SMBS | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.15% | 1.55% | -0.40% |
Volatility (6M)Calculated over the trailing 6-month period | 2.47% | 3.03% | -0.56% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.53% | 4.15% | -0.62% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 5.15% | 4.86% | +0.29% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 4.26% | 4.86% | -0.60% |
MBSD vs. SMBS - Expense Ratio Comparison
MBSD has a 0.20% expense ratio, which is higher than SMBS's 0.03% 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
MBSD vs. SMBS - Dividend Comparison
MBSD's dividend yield for the trailing twelve months is around 4.19%, less than SMBS's 5.17% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
MBSD FlexShares Disciplined Duration MBS Index Fund | 4.19% | 4.23% | 3.91% | 3.39% | 3.03% | 2.41% | 2.78% | 3.42% | 3.22% | 3.30% | 3.02% | 3.46% |
SMBS Schwab Mortgage-Backed Securities ETF | 5.17% | 4.83% | 0.50% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Frequently Asked Questions
MBSD and SMBS have a correlation of 0.84, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
SMBS has higher volatility (1.55%) compared to MBSD (1.15%). In terms of maximum drawdown, MBSD dropped -14.36% vs SMBS's -3.20%.
On 1-year performance, SMBS leads with 6.78% vs 5.26% for MBSD. On fees, SMBS is cheaper at 0.03% per year. On volatility, MBSD has been the lower-risk option at 1.15%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 1-year period, SMBS has performed better with a 6.78% return vs 5.26%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
SMBS is cheaper with a 0.03% expense ratio, compared with 0.20% for MBSD.
SMBS has the higher dividend yield at 5.17%, compared with 4.19% for MBSD.
MBSD tracks ICE BofA Constrained Duration US Mortgage Backed Securities, while SMBS tracks Bloomberg US MBS Float Adjusted Total Return Index. They also come from different issuers: Northern Trust and Charles Schwab. Their fees differ too: 0.20% for MBSD and 0.03% for SMBS.
SMBS currently has the higher Sharpe Ratio (1.64 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.
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