NATO vs. SHLD

Last updated Jun 24, 2026

NATO (Themes Transatlantic Defense ETF) and SHLD (Global X Defense Tech ETF) are both Aerospace & Defense funds - NATO tracks the Solactive Transatlantic Aerospace and Defense Index while SHLD tracks the Global X Defense Tech Index. Both are passively managed. Over the past year, NATO returned 17.37% vs 4.03% for SHLD. A 0.79 correlation means they provide meaningful diversification when combined. NATO charges 0.35%/yr vs 0.50%/yr for SHLD.

Performance

NATO vs. SHLD - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Themes Transatlantic Defense ETF (NATO) and Global X Defense Tech ETF (SHLD). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, NATO achieves a 4.58% return, which is significantly higher than SHLD's -6.53% return.

NATO

• 1D: -0.10%
• 1M: 1.72%
• YTD: 4.58%
• 6M: 4.25%
• 1Y: 17.37%
• 3Y*: —
• 5Y*: —
• 10Y*: —

SHLD

• 1D: -0.05%
• 1M: -7.05%
• YTD: -6.53%
• 6M: -8.73%
• 1Y: 4.03%
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

NATO vs. SHLD - Yearly Performance Comparison

	2026 (YTD)	2025	2024
NATO Themes Transatlantic Defense ETF	4.58%	50.95%	0.51%
SHLD Global X Defense Tech ETF	-6.53%	74.16%	-0.80%

Correlation

The correlation between NATO and SHLD is 0.81, 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	0.81
Correlation (All Time) Calculated using the full available price history since Oct 11, 2024	0.79

The correlation between NATO and SHLD has been stable across timeframes, ranging from 0.79 to 0.81 - a consistent structural relationship.

Return for Risk

NATO vs. SHLD — Risk / Return Rank

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

NATO

NATO Risk / Return Rank: 23
NATO Sharpe Ratio Rank: 24
NATO Sortino Ratio Rank: 25
NATO Omega Ratio Rank: 23
NATO Calmar Ratio Rank: 24
NATO Martin Ratio Rank: 22

SHLD

SHLD Risk / Return Rank: 11
SHLD Sharpe Ratio Rank: 11
SHLD Sortino Ratio Rank: 11
SHLD Omega Ratio Rank: 10
SHLD Calmar Ratio Rank: 10
SHLD Martin Ratio Rank: 11

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.

NATO vs. SHLD - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Themes Transatlantic Defense ETF (NATO) and Global X Defense Tech ETF (SHLD). 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.

	NATO	SHLD	Difference
Sharpe ratio: Return per unit of total volatility	0.81	0.16	+0.65
Sortino ratio: Return per unit of downside risk	1.31	0.41	+0.90
Omega ratio: Gain probability vs. loss probability	1.15	1.05	+0.11
Calmar ratio: Return relative to maximum drawdown	1.09	0.18	+0.91
Martin ratio: Return relative to average drawdown	2.65	0.46	+2.18

NATO vs. SHLD - Sharpe Ratio Comparison

The current NATO Sharpe Ratio is 0.81, which is higher than the SHLD Sharpe Ratio of 0.16. The chart below compares the historical Sharpe Ratios of NATO and SHLD, 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

NATO vs. SHLD - Drawdown Comparison

The maximum NATO drawdown since its inception was -15.99%, smaller than the maximum SHLD drawdown of -22.38%. Use the drawdown chart below to compare losses from any high point for NATO and SHLD.

Drawdown Indicators

	NATO	SHLD	Difference
Max Drawdown Largest peak-to-trough decline	-15.99%	-22.38%	+6.39%
Max Drawdown (1Y) Largest decline over 1 year	-15.99%	-22.38%	+6.39%
Current Drawdown Current decline from peak	-9.55%	-22.38%	+12.83%
Average Drawdown Average peak-to-trough decline	-3.89%	-3.49%	-0.40%
Ulcer Index Depth and duration of drawdowns from previous peaks	6.57%	8.69%	-2.12%

Volatility

NATO vs. SHLD - Volatility Comparison

The current volatility for Themes Transatlantic Defense ETF (NATO) is 7.57%, while Global X Defense Tech ETF (SHLD) has a volatility of 9.04%. This indicates that NATO experiences smaller price fluctuations and is considered to be less risky than SHLD based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	NATO	SHLD	Difference
Volatility (1M) Calculated over the trailing 1-month period	7.57%	9.04%	-1.47%
Volatility (6M) Calculated over the trailing 6-month period	18.35%	20.19%	-1.84%
Volatility (1Y) Calculated over the trailing 1-year period	21.46%	24.71%	-3.25%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.72%	21.33%	+1.39%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.72%	21.33%	+1.39%

NATO vs. SHLD - Expense Ratio Comparison

NATO has a 0.35% expense ratio, which is lower than SHLD's 0.50% expense ratio.

Dividends

NATO vs. SHLD - Dividend Comparison

NATO's dividend yield for the trailing twelve months is around 0.43%, less than SHLD's 0.59% yield.

Position	TTM	2025	2024	2023
NATO Themes Transatlantic Defense ETF	0.43%	0.45%	0.08%	0.00%
SHLD Global X Defense Tech ETF	0.59%	0.55%	0.53%	0.26%

Frequently Asked Questions

Can I hold both NATO and SHLD in my portfolio?

NATO and SHLD have a correlation of 0.81, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, NATO or SHLD?

SHLD has higher volatility (9.04%) compared to NATO (7.57%). In terms of maximum drawdown, NATO dropped -15.99% vs SHLD's -22.38%.

Which ETF is better, NATO or SHLD?

On 1-year performance, NATO leads with 17.37% vs 4.03% for SHLD. On fees, NATO is cheaper at 0.35% per year. On volatility, NATO has been the lower-risk option at 7.57%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, NATO or SHLD?

Over the 1-year period, NATO has performed better with a 17.37% return vs 4.03%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, NATO or SHLD?

NATO is cheaper with a 0.35% expense ratio, compared with 0.50% for SHLD.

Which ETF pays a higher dividend yield, NATO or SHLD?

SHLD has the higher dividend yield at 0.59%, compared with 0.43% for NATO.

What is the main difference between NATO and SHLD?

NATO tracks Solactive Transatlantic Aerospace and Defense Index, while SHLD tracks Global X Defense Tech Index. They also come from different issuers: Themes and Global X. Their fees differ too: 0.35% for NATO and 0.50% for SHLD.

Which has better risk-adjusted returns?

NATO currently has the higher Sharpe Ratio (0.81 vs 0.16), 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.