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VAW vs. TIP
Performance
Return for Risk
Drawdowns
Volatility
Dividends

VAW vs. TIP

Last updated Jun 9, 2026

VAW (Vanguard Materials ETF) and TIP (iShares TIPS Bond ETF) are both exchange-traded funds - VAW is a Materials fund tracking the MSCI US Investable Market Materials 25/50 Index, while TIP is a Inflation-Protected Bonds fund tracking the ICE U.S. Treasury Inflation Linked Bond Index. Both are passively managed. Over the past 10 years, VAW returned 9.87%/yr vs 2.45%/yr for TIP. At a correlation of -0.06, they often move in opposite directions. VAW charges 0.10%/yr vs 0.18%/yr for TIP.

Performance

VAW vs. TIP - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in Vanguard Materials ETF (VAW) and iShares TIPS Bond ETF (TIP). The values are adjusted to include any dividend payments, if applicable.

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Returns By Period

In the year-to-date period, VAW achieves a 9.07% return, which is significantly higher than TIP's 0.95% return. Over the past 10 years, VAW has outperformed TIP with an annualized return of 9.87%, while TIP has yielded a comparatively lower 2.45% annualized return.

VAW

1D
-1.01%
1M
-3.30%
YTD
9.07%
6M
14.24%
1Y
17.86%
3Y*
10.82%
5Y*
5.32%
10Y*
9.87%

TIP

1D
-0.11%
1M
-0.90%
YTD
0.95%
6M
0.97%
1Y
4.81%
3Y*
3.70%
5Y*
0.88%
10Y*
2.45%
*Multi-year figures are annualized to reflect compound growth (CAGR)

VAW vs. TIP - Yearly Performance Comparison

2026 (YTD)202520242023202220212020201920182017
VAW
Vanguard Materials ETF		9.07%12.30%0.48%13.67%-11.80%27.43%19.44%23.53%-17.49%23.76%
TIP
iShares TIPS Bond ETF		0.95%6.77%1.65%3.80%-12.26%5.68%10.84%8.35%-1.42%2.92%

Correlation

The correlation between VAW and TIP is 0.29, which is low. Their price movements are largely independent, making them effective diversification partners.

Correlation
Correlation (1Y)
Calculated over the trailing 1-year period

0.29

Correlation (3Y)
Calculated over the trailing 3-year period

0.25

Correlation (5Y)
Calculated over the trailing 5-year period

0.20

Correlation (10Y)
Calculated over the trailing 10-year period

0.07

Correlation (All Time)
Calculated using the full available price history since Feb 2, 2004

-0.06

The correlation between VAW and TIP shifts across timeframes, from -0.06 (all time) to 0.29 (1 year), reflecting how their relationship changes across market environments.

Compare stocks, funds, or ETFs

Search for stocks, ETFs, and funds for a quick comparison or use the comparison tool for more options.

Vanguard Materials ETF

iShares TIPS Bond ETF

Often compared with VAW:
VAW vs. XLBVAW vs. XMEVAW vs. PAVEVAW vs. FMATVAW vs. DBCVAW vs. IYMVAW vs. VDE
Often compared with TIP:
TIP vs. SCHPTIP vs. VTIPTIP vs. SGOVTIP vs. STIPTIP vs. FIPDXTIP vs. BNDTIP vs. IEF

Return for Risk

VAW vs. TIP — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.
VAW
VAW Risk / Return Rank: 3030
Overall Rank
VAW Sharpe Ratio Rank: 3030
Sharpe Ratio Rank
VAW Sortino Ratio Rank: 3030
Sortino Ratio Rank
VAW Omega Ratio Rank: 2828
Omega Ratio Rank
VAW Calmar Ratio Rank: 3030
Calmar Ratio Rank
VAW Martin Ratio Rank: 3232
Martin Ratio Rank
TIP
TIP Risk / Return Rank: 4848
Overall Rank
TIP Sharpe Ratio Rank: 4545
Sharpe Ratio Rank
TIP Sortino Ratio Rank: 5050
Sortino Ratio Rank
TIP Omega Ratio Rank: 4444
Omega Ratio Rank
TIP Calmar Ratio Rank: 5454
Calmar Ratio Rank
TIP Martin Ratio Rank: 4848
Martin Ratio Rank
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.

VAW vs. TIP - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Vanguard Materials ETF (VAW) and iShares TIPS Bond ETF (TIP). 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.

VAWTIPDifference
Sharpe ratioReturn per unit of total volatility
1.01
1.43

-0.43

Sortino ratioReturn per unit of downside risk
1.49
2.21

-0.72

Omega ratioGain probability vs. loss probability

1.18

1.26

-0.08

Calmar ratioReturn relative to maximum drawdown

1.34

2.45

-1.11

Martin ratioReturn relative to average drawdown

4.32

7.37

-3.04

Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

VAW vs. TIP - Sharpe Ratio Comparison

The current VAW Sharpe Ratio is 1.01, which is comparable to the TIP Sharpe Ratio of 1.43. The chart below compares the historical Sharpe Ratios of VAW and TIP, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

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Sharpe Ratios by Period

VAWTIPDifference

Sharpe Ratio (1Y)

Calculated over the trailing 1-year period

1.01

1.43

-0.43

Sharpe Ratio (5Y)

Calculated over the trailing 5-year period

0.27

0.14

+0.13

Sharpe Ratio (10Y)

Calculated over the trailing 10-year period

0.47

0.43

+0.04

Sharpe Ratio (All Time)

Calculated using the full available price history

0.39

0.57

-0.18

Drawdowns

VAW vs. TIP - Drawdown Comparison

The maximum VAW drawdown since its inception was -62.17%, which is greater than TIP's maximum drawdown of -14.57%. Use the drawdown chart below to compare losses from any high point for VAW and TIP.

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Drawdown Indicators

VAWTIPDifference

Max Drawdown

Largest peak-to-trough decline

-62.17%

-14.57%

-47.60%

Max Drawdown (1Y)

Largest decline over 1 year

-13.42%

-1.98%

-11.44%

Max Drawdown (3Y)

Largest decline over 3 years

-23.21%

-4.54%

-18.67%

Max Drawdown (5Y)

Largest decline over 5 years

-25.50%

-14.51%

-10.99%

Max Drawdown (10Y)

Largest decline over 10 years

-41.13%

-14.51%

-26.62%

Current Drawdown

Current decline from peak

-7.27%

-0.90%

-6.37%

Average Drawdown

Average peak-to-trough decline

-9.63%

-3.43%

-6.20%

Ulcer Index

Depth and duration of drawdowns from previous peaks

4.14%

0.65%

+3.49%

Volatility

VAW vs. TIP - Volatility Comparison

Vanguard Materials ETF (VAW) has a higher volatility of 5.94% compared to iShares TIPS Bond ETF (TIP) at 1.01%. This indicates that VAW's price experiences larger fluctuations and is considered to be riskier than TIP based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

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Volatility by Period

VAWTIPDifference

Volatility (1M)

Calculated over the trailing 1-month period

5.94%

1.01%

+4.93%

Volatility (6M)

Calculated over the trailing 6-month period

14.18%

2.33%

+11.85%

Volatility (1Y)

Calculated over the trailing 1-year period

17.88%

3.38%

+14.50%

Volatility (5Y)

Calculated over the trailing 5-year period, annualized

19.65%

6.21%

+13.44%

Volatility (10Y)

Calculated over the trailing 10-year period, annualized

21.22%

5.74%

+15.48%

VAW vs. TIP - Expense Ratio Comparison

VAW has a 0.10% expense ratio, which is lower than TIP's 0.18% expense ratio. Despite the difference, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

VAW vs. TIP - Dividend Comparison

VAW's dividend yield for the trailing twelve months is around 1.41%, less than TIP's 3.78% yield.

PositionTTM20252024202320222021202020192018201720162015
TIP
iShares TIPS Bond ETF		3.78%3.46%2.52%2.73%6.96%4.28%1.17%1.75%2.71%2.07%1.48%0.34%
VAW
Vanguard Materials ETF		1.41%1.55%1.70%1.72%1.98%1.44%1.67%1.94%2.03%1.63%1.67%2.30%

Frequently Asked Questions

VAW and TIP have a correlation of 0.29, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

VAW has higher volatility (5.94%) compared to TIP (1.01%). In terms of maximum drawdown, VAW dropped -62.17% vs TIP's -14.57%.

On 10-year performance, VAW leads with 9.87% vs 2.45% for TIP. On fees, VAW is cheaper at 0.10% per year. On volatility, TIP has been the lower-risk option at 1.01%. The better choice depends on whether you care most about return, fees, risk, or income.

Over the 10-year period, VAW has performed better with a 9.87% return vs 2.45%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

VAW is cheaper with a 0.10% expense ratio, compared with 0.18% for TIP.

TIP has the higher dividend yield at 3.78%, compared with 1.41% for VAW.

VAW is categorized as Materials, while TIP is Inflation-Protected Bonds. VAW tracks MSCI US Investable Market Materials 25/50 Index, while TIP tracks ICE U.S. Treasury Inflation Linked Bond Index. They also come from different issuers: Vanguard and iShares. Their fees differ too: 0.10% for VAW and 0.18% for TIP.

TIP currently has the higher Sharpe Ratio (1.43 vs 1.01), 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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