UTWO vs. SHY
UTWO (US Treasury 2 Year Note ETF) and SHY (iShares 1-3 Year Treasury Bond ETF) are both Government Bonds funds - UTWO tracks the ICE BofA Current 2 Year US Treasury Index - Benchmark TR Gross while SHY tracks the ICE US Treasury 1-3 Year Index. Both are passively managed. Over the past 3 years, UTWO returned 3.85%/yr vs 4.10%/yr for SHY. With a 0.96 correlation, they move nearly in lockstep. Both charge a 0.15% expense ratio.
Performance
UTWO vs. SHY - Performance Comparison
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Returns By Period
In the year-to-date period, UTWO achieves a 0.33% return, which is significantly lower than SHY's 0.43% return.
UTWO
- 1D
- 0.09%
- 1M
- 0.15%
- YTD
- 0.33%
- 6M
- 0.51%
- 1Y
- 2.73%
- 3Y*
- 3.85%
- 5Y*
- —
- 10Y*
- —
SHY
- 1D
- 0.07%
- 1M
- 0.11%
- YTD
- 0.43%
- 6M
- 0.60%
- 1Y
- 2.87%
- 3Y*
- 4.10%
- 5Y*
- 1.75%
- 10Y*
- 1.62%
UTWO vs. SHY - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | |
|---|---|---|---|---|---|
UTWO US Treasury 2 Year Note ETF | 0.33% | 4.79% | 3.71% | 3.45% | -0.84% |
SHY iShares 1-3 Year Treasury Bond ETF | 0.43% | 4.95% | 3.92% | 4.16% | -0.83% |
Correlation
The correlation between UTWO and SHY is 0.95 - these two move nearly in lockstep. At this level, holding both provides almost no diversification benefit. If you already own one, adding the other does little to reduce portfolio risk.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.95 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.95 |
Correlation (All Time) Calculated using the full available price history since Aug 9, 2022 | 0.96 |
The correlation between UTWO and SHY has been stable across timeframes, ranging from 0.95 to 0.96 - a consistent structural relationship.
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Return for Risk
UTWO vs. SHY — Risk / Return Rank
UTWO
SHY
UTWO vs. SHY - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for US Treasury 2 Year Note ETF (UTWO) and iShares 1-3 Year Treasury Bond ETF (SHY). 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.
| UTWO | SHY | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.11 | ||
| Sortino ratioReturn per unit of downside risk | -0.15 | ||
| Omega ratioGain probability vs. loss probability | 1.40 | 1.42 | -0.02 |
| Calmar ratioReturn relative to maximum drawdown | 3.05 | 3.24 | -0.19 |
| Martin ratioReturn relative to average drawdown | 10.64 | 12.62 | -1.97 |
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Drawdowns
UTWO vs. SHY - Drawdown Comparison
The maximum UTWO drawdown since its inception was -2.04%, smaller than the maximum SHY drawdown of -5.71%. Use the drawdown chart below to compare losses from any high point for UTWO and SHY.
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Drawdown Indicators
| UTWO | SHY | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -2.04% | -5.71% | +3.67% |
Max Drawdown (1Y)Largest decline over 1 year | -0.90% | -0.89% | -0.01% |
Max Drawdown (3Y)Largest decline over 3 years | -1.08% | -0.97% | -0.11% |
Max Drawdown (5Y)Largest decline over 5 years | — | -5.71% | — |
Max Drawdown (10Y)Largest decline over 10 years | — | -5.71% | — |
Current DrawdownCurrent decline from peak | -0.38% | -0.31% | -0.07% |
Average DrawdownAverage peak-to-trough decline | -0.48% | -0.52% | +0.04% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.26% | 0.23% | +0.03% |
Volatility
UTWO vs. SHY - Volatility Comparison
US Treasury 2 Year Note ETF (UTWO) and iShares 1-3 Year Treasury Bond ETF (SHY) have volatilities of 0.48% and 0.50%, respectively, indicating that both stocks experience similar levels of price fluctuations. This suggests that the risk associated with both stocks, as measured by volatility, is nearly the same. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| UTWO | SHY | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 0.48% | 0.50% | -0.02% |
Volatility (6M)Calculated over the trailing 6-month period | 1.00% | 1.01% | -0.01% |
Volatility (1Y)Calculated over the trailing 1-year period | 1.37% | 1.37% | 0.00% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 2.07% | 1.99% | +0.08% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 2.07% | 1.57% | +0.50% |
UTWO vs. SHY - Expense Ratio Comparison
Both UTWO and SHY have an expense ratio of 0.15%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.
Dividends
UTWO vs. SHY - Dividend Comparison
UTWO's dividend yield for the trailing twelve months is around 3.50%, less than SHY's 3.68% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
SHY iShares 1-3 Year Treasury Bond ETF | 3.68% | 3.81% | 3.92% | 2.99% | 1.30% | 0.26% | 0.94% | 2.12% | 1.72% | 0.98% | 0.71% | 0.54% |
UTWO US Treasury 2 Year Note ETF | 3.50% | 3.63% | 4.22% | 4.39% | 1.22% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Frequently Asked Questions
With a correlation of 0.95, UTWO and SHY 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.
SHY has higher volatility (0.50%) compared to UTWO (0.48%). In terms of maximum drawdown, UTWO dropped -2.04% vs SHY's -5.71%.
On 3-year performance, SHY leads with 4.10% vs 3.85% for UTWO. Both ETFs have the same 0.15% expense ratio. Their volatility is very similar. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 3-year period, SHY has performed better with a 4.10% return vs 3.85%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
UTWO and SHY have the same expense ratio: 0.15% per year.
SHY has the higher dividend yield at 3.68%, compared with 3.50% for UTWO.
UTWO tracks ICE BofA Current 2 Year US Treasury Index - Benchmark TR Gross, while SHY tracks ICE US Treasury 1-3 Year Index. They also come from different issuers: US Benchmark Series and iShares.
SHY currently has the higher Sharpe Ratio (2.10 vs 2.00), 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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