PSFO vs. FAAR

Last updated Jun 24, 2026

PSFO (Pacer Swan SOS Flex (October) ETF) and FAAR (First Trust Alternative Absolute Return Strategy ETF) are both exchange-traded funds - PSFO is a Options Trading fund actively managed by Pacer, while FAAR is a Commodities fund actively managed by First Trust. Both are actively managed. Over the past 3 years, PSFO returned 12.39%/yr vs 10.57%/yr for FAAR. At a correlation of -0.00, they often move in opposite directions. PSFO charges 0.60%/yr vs 0.95%/yr for FAAR.

Performance

PSFO vs. FAAR - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Pacer Swan SOS Flex (October) ETF (PSFO) and First Trust Alternative Absolute Return Strategy ETF (FAAR). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, PSFO achieves a 5.92% return, which is significantly lower than FAAR's 19.14% return.

PSFO

• 1D: -0.63%
• 1M: -0.07%
• YTD: 5.92%
• 6M: 5.46%
• 1Y: 16.06%
• 3Y*: 12.39%
• 5Y*: —
• 10Y*: —

FAAR

• 1D: -0.91%
• 1M: -5.21%
• YTD: 19.14%
• 6M: 18.06%
• 1Y: 28.33%
• 3Y*: 10.57%
• 5Y*: 7.72%
• 10Y*: 4.69%

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

PSFO vs. FAAR - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021
PSFO Pacer Swan SOS Flex (October) ETF	5.92%	12.93%	10.78%	20.03%	-0.34%	4.84%
FAAR First Trust Alternative Absolute Return Strategy ETF	19.14%	8.07%	5.97%	-5.63%	10.15%	0.14%

Correlation

The correlation between PSFO and FAAR is -0.06, meaning there is essentially no relationship between their price movements. Each responds to its own set of market drivers, making them strong candidates for combining in a diversified portfolio.

	Correlation
Correlation (1Y) Calculated over the trailing 1-year period	-0.06
Correlation (3Y) Calculated over the trailing 3-year period	0.01
Correlation (All Time) Calculated using the full available price history since Oct 1, 2021	-0.00

Return for Risk

PSFO vs. FAAR — Risk / Return Rank

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

PSFO

PSFO Risk / Return Rank: 76
PSFO Sharpe Ratio Rank: 75
PSFO Sortino Ratio Rank: 79
PSFO Omega Ratio Rank: 79
PSFO Calmar Ratio Rank: 68
PSFO Martin Ratio Rank: 81

FAAR

FAAR Risk / Return Rank: 75
FAAR Sharpe Ratio Rank: 71
FAAR Sortino Ratio Rank: 74
FAAR Omega Ratio Rank: 65
FAAR Calmar Ratio Rank: 86
FAAR Martin Ratio Rank: 81

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.

PSFO vs. FAAR - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Pacer Swan SOS Flex (October) ETF (PSFO) and First Trust Alternative Absolute Return Strategy ETF (FAAR). 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.

	PSFO	FAAR	Difference
Sharpe ratio: Return per unit of total volatility	2.20	2.15	+0.04
Sortino ratio: Return per unit of downside risk	3.19	3.09	+0.09
Omega ratio: Gain probability vs. loss probability	1.42	1.37	+0.06
Calmar ratio: Return relative to maximum drawdown	3.10	4.52	-1.42
Martin ratio: Return relative to average drawdown	14.83	15.18	-0.34

PSFO vs. FAAR - Sharpe Ratio Comparison

The current PSFO Sharpe Ratio is 2.20, which is comparable to the FAAR Sharpe Ratio of 2.15. The chart below compares the historical Sharpe Ratios of PSFO and FAAR, 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

PSFO vs. FAAR - Drawdown Comparison

The maximum PSFO drawdown since its inception was -12.09%, smaller than the maximum FAAR drawdown of -18.03%. Use the drawdown chart below to compare losses from any high point for PSFO and FAAR.

Drawdown Indicators

	PSFO	FAAR	Difference
Max Drawdown Largest peak-to-trough decline	-12.09%	-18.03%	+5.94%
Max Drawdown (1Y) Largest decline over 1 year	-5.20%	-6.29%	+1.09%
Max Drawdown (3Y) Largest decline over 3 years	-12.09%	-11.54%	-0.55%
Max Drawdown (5Y) Largest decline over 5 years	—	-18.03%	—
Max Drawdown (10Y) Largest decline over 10 years	—	-18.03%	—
Current Drawdown Current decline from peak	-0.89%	-6.29%	+5.40%
Average Drawdown Average peak-to-trough decline	-1.74%	-7.82%	+6.08%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.09%	1.87%	-0.78%

Volatility

PSFO vs. FAAR - Volatility Comparison

The current volatility for Pacer Swan SOS Flex (October) ETF (PSFO) is 2.03%, while First Trust Alternative Absolute Return Strategy ETF (FAAR) has a volatility of 2.55%. This indicates that PSFO experiences smaller price fluctuations and is considered to be less risky than FAAR based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	PSFO	FAAR	Difference
Volatility (1M) Calculated over the trailing 1-month period	2.03%	2.55%	-0.52%
Volatility (6M) Calculated over the trailing 6-month period	5.69%	9.68%	-3.99%
Volatility (1Y) Calculated over the trailing 1-year period	7.38%	13.38%	-6.00%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	10.03%	12.96%	-2.93%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	10.03%	11.54%	-1.51%

PSFO vs. FAAR - Expense Ratio Comparison

PSFO has a 0.60% expense ratio, which is lower than FAAR's 0.95% expense ratio.

Dividends

PSFO vs. FAAR - Dividend Comparison

PSFO has not paid dividends to shareholders, while FAAR's dividend yield for the trailing twelve months is around 9.66%.

Position	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017
FAAR First Trust Alternative Absolute Return Strategy ETF	9.66%	11.63%	3.45%	3.20%	5.82%	6.49%	3.05%	1.02%	0.58%	2.83%
PSFO Pacer Swan SOS Flex (October) ETF	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%

Frequently Asked Questions

Can I hold both PSFO and FAAR in my portfolio?

PSFO and FAAR have a correlation of -0.06, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which is riskier, PSFO or FAAR?

FAAR has higher volatility (2.55%) compared to PSFO (2.03%). In terms of maximum drawdown, PSFO dropped -12.09% vs FAAR's -18.03%.

Which ETF is better, PSFO or FAAR?

On 3-year performance, PSFO leads with 12.39% vs 10.57% for FAAR. On fees, PSFO is cheaper at 0.60% per year. On volatility, PSFO has been the lower-risk option at 2.03%. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF has performed better, PSFO or FAAR?

Over the 3-year period, PSFO has performed better with a 12.39% return vs 10.57%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

Which ETF is cheaper, PSFO or FAAR?

PSFO is cheaper with a 0.60% expense ratio, compared with 0.95% for FAAR.

Which ETF pays a higher dividend yield, PSFO or FAAR?

FAAR has the higher dividend yield at 9.66%, compared with 0.00% for PSFO.

What is the main difference between PSFO and FAAR?

PSFO is categorized as Options Trading, while FAAR is Commodities. They also come from different issuers: Pacer and First Trust. Their fees differ too: 0.60% for PSFO and 0.95% for FAAR.

Which has better risk-adjusted returns?

PSFO currently has the higher Sharpe Ratio (2.20 vs 2.15), 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.