NATO vs. USO

Last updated Jun 5, 2026

NATO (Themes Transatlantic Defense ETF) and USO (United States Oil Fund LP) are both exchange-traded funds - NATO is a Aerospace & Defense fund tracking the Solactive Transatlantic Aerospace and Defense Index, while USO is a Oil & Gas fund tracking the Front Month Light Sweet Crude Oil. Both are passively managed. Over the past year, NATO returned 15.44% vs 97.20% for USO. At a correlation of -0.11, they often move in opposite directions. NATO charges 0.35%/yr vs 0.86%/yr for USO.

Performance

NATO vs. USO - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Themes Transatlantic Defense ETF (NATO) and United States Oil Fund LP (USO). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, NATO achieves a 3.53% return, which is significantly lower than USO's 97.72% return.

NATO

• 1D: 2.10%
• 1M: 3.55%
• YTD: 3.53%
• 6M: 8.84%
• 1Y: 15.44%
• 3Y*: —
• 5Y*: —
• 10Y*: —

USO

• 1D: -2.92%
• 1M: -5.15%
• YTD: 97.72%
• 6M: 91.54%
• 1Y: 97.20%
• 3Y*: 28.78%
• 5Y*: 23.67%
• 10Y*: 3.57%

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

NATO vs. USO - Yearly Performance Comparison

	2026 (YTD)	2025	2024
NATO Themes Transatlantic Defense ETF	3.53%	50.95%	0.35%
USO United States Oil Fund LP	97.72%	-8.46%	-2.50%

Correlation

The correlation between NATO and USO is -0.19, 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	-0.19
Correlation (All Time) Calculated using the full available price history since Oct 14, 2024	-0.11

Return for Risk

NATO vs. USO — Risk / Return Rank

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

NATO

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

USO

USO Risk / Return Rank: 66
USO Sharpe Ratio Rank: 68
USO Sortino Ratio Rank: 61
USO Omega Ratio Rank: 62
USO Calmar Ratio Rank: 86
USO Martin Ratio Rank: 54

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. USO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Themes Transatlantic Defense ETF (NATO) and United States Oil Fund LP (USO). 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.

	NATO	USO	Difference
Sharpe ratio: Return per unit of total volatility	0.75	2.21	-1.46
Sortino ratio: Return per unit of downside risk	1.20	2.80	-1.60
Omega ratio: Gain probability vs. loss probability	1.14	1.37	-0.23
Calmar ratio: Return relative to maximum drawdown	0.97	4.79	-3.82
Martin ratio: Return relative to average drawdown	2.50	9.00	-6.50
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

NATO vs. USO - Sharpe Ratio Comparison

The current NATO Sharpe Ratio is 0.75, which is lower than the USO Sharpe Ratio of 2.21. The chart below compares the historical Sharpe Ratios of NATO and USO, 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

	NATO	USO	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.75	2.21	-1.46
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	—	0.66	—
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	—	0.09	—
Sharpe Ratio (All Time) Calculated using the full available price history	1.41	-0.18	+1.58

Drawdowns

NATO vs. USO - Drawdown Comparison

The maximum NATO drawdown since its inception was -15.99%, smaller than the maximum USO drawdown of -98.19%. Use the drawdown chart below to compare losses from any high point for NATO and USO.

Drawdown Indicators

	NATO	USO	Difference
Max Drawdown Largest peak-to-trough decline	-15.99%	-98.19%	+82.20%
Max Drawdown (1Y) Largest decline over 1 year	-15.99%	-20.39%	+4.40%
Max Drawdown (3Y) Largest decline over 3 years	—	-26.05%	—
Max Drawdown (5Y) Largest decline over 5 years	—	-36.23%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-86.75%	—
Current Drawdown Current decline from peak	-10.46%	-85.45%	+74.99%
Average Drawdown Average peak-to-trough decline	-3.73%	-75.30%	+71.57%
Ulcer Index Depth and duration of drawdowns from previous peaks	6.20%	10.84%	-4.64%

Volatility

NATO vs. USO - Volatility Comparison

The current volatility for Themes Transatlantic Defense ETF (NATO) is 8.20%, while United States Oil Fund LP (USO) has a volatility of 14.97%. This indicates that NATO experiences smaller price fluctuations and is considered to be less risky than USO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	NATO	USO	Difference
Volatility (1M) Calculated over the trailing 1-month period	8.20%	14.97%	-6.77%
Volatility (6M) Calculated over the trailing 6-month period	17.74%	38.35%	-20.61%
Volatility (1Y) Calculated over the trailing 1-year period	20.80%	44.32%	-23.52%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	22.64%	36.09%	-13.45%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	22.64%	39.00%	-16.36%

NATO vs. USO - Expense Ratio Comparison

NATO has a 0.35% expense ratio, which is lower than USO's 0.86% expense ratio.

Dividends

NATO vs. USO - Dividend Comparison

NATO's dividend yield for the trailing twelve months is around 0.44%, while USO has not paid dividends to shareholders.

Position	TTM	2025	2024
NATO Themes Transatlantic Defense ETF	0.44%	0.45%	0.08%
USO United States Oil Fund LP	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both NATO and USO in my portfolio?

NATO and USO have a correlation of -0.19, 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 USO?

USO has higher volatility (14.97%) compared to NATO (8.20%). In terms of maximum drawdown, NATO dropped -15.99% vs USO's -98.19%.

Which ETF is better, NATO or USO?

On 1-year performance, USO leads with 97.20% vs 15.44% for NATO. On fees, NATO is cheaper at 0.35% per year. On volatility, NATO has been the lower-risk option at 8.20%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, NATO or USO?

Over the 1-year period, USO has performed better with a 97.20% return vs 15.44%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, NATO or USO?

NATO is cheaper with a 0.35% expense ratio, compared with 0.86% for USO.

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

NATO has the higher dividend yield at 0.44%, compared with 0.00% for USO.

What is the main difference between NATO and USO?

NATO is categorized as Aerospace & Defense, while USO is Oil & Gas. NATO tracks Solactive Transatlantic Aerospace and Defense Index, while USO tracks Front Month Light Sweet Crude Oil. They also come from different issuers: Themes and USCF. Their fees differ too: 0.35% for NATO and 0.86% for USO.

Which has better risk-adjusted returns?

USO currently has the higher Sharpe Ratio (2.21 vs 0.75), 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.