XDEF vs. NATO

Last updated Jun 23, 2026

XDEF (Xtrackers Europe Defense Technologies ETF) and NATO (Themes Transatlantic Defense ETF) are both Aerospace & Defense funds - XDEF tracks the STOXX Europe Total Market Defence, Space and Cybersecurity Innovation 50-25 Index while NATO tracks the Solactive Transatlantic Aerospace and Defense Index. Both are passively managed. Their correlation of 0.82 suggests significant overlap in exposure. Both charge a 0.35% expense ratio.

Performance

XDEF vs. NATO - Performance Comparison

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

Returns By Period

XDEF

• 1D: -1.15%
• 1M: -2.17%
• YTD: —
• 6M: —
• 1Y: —
• 3Y*: —
• 5Y*: —
• 10Y*: —

NATO

• 1D: -1.18%
• 1M: 1.83%
• YTD: 4.69%
• 6M: 4.49%
• 1Y: 18.50%
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

XDEF vs. NATO - Yearly Performance Comparison

	2026 (YTD)
XDEF Xtrackers Europe Defense Technologies ETF	-99.16%
NATO Themes Transatlantic Defense ETF	4.69%

Correlation

The correlation between XDEF and NATO is 0.82, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

	Correlation
Correlation (All Time) Calculated using the full available price history since Jan 2, 2026	0.82

Return for Risk

XDEF vs. NATO — Risk / Return Rank

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

XDEF

Risk / return metrics aren't available yet — we need at least 12 months of trading data to calculate them.

NATO

NATO Risk / Return Rank: 24
NATO Sharpe Ratio Rank: 25
NATO Sortino Ratio Rank: 26
NATO Omega Ratio Rank: 24
NATO Calmar Ratio Rank: 25
NATO Martin Ratio Rank: 23

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.

XDEF vs. NATO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for Xtrackers Europe Defense Technologies ETF (XDEF) and Themes Transatlantic Defense ETF (NATO). 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.

	XDEF	NATO	Difference
Sharpe ratio: Return per unit of total volatility	—	0.87	—
Sortino ratio: Return per unit of downside risk	—	1.38	—
Omega ratio: Gain probability vs. loss probability	—	1.16	—
Calmar ratio: Return relative to maximum drawdown	—	1.16	—
Martin ratio: Return relative to average drawdown	—	2.83	—

Drawdowns

XDEF vs. NATO - Drawdown Comparison

The maximum XDEF drawdown since its inception was -99.30%, which is greater than NATO's maximum drawdown of -15.99%. Use the drawdown chart below to compare losses from any high point for XDEF and NATO.

Drawdown Indicators

	XDEF	NATO	Difference
Max Drawdown Largest peak-to-trough decline	-99.30%	-15.99%	-83.31%
Max Drawdown (1Y) Largest decline over 1 year	—	-15.99%	—
Current Drawdown Current decline from peak	-99.26%	-9.45%	-89.81%
Average Drawdown Average peak-to-trough decline	-72.80%	-3.88%	-68.92%
Ulcer Index Depth and duration of drawdowns from previous peaks	—	6.55%	—

Volatility

Volatility by Period

	XDEF	NATO	Difference
Volatility (1M) Calculated over the trailing 1-month period	—	7.56%	—
Volatility (6M) Calculated over the trailing 6-month period	—	18.40%	—
Volatility (1Y) Calculated over the trailing 1-year period	148.83%	21.51%	+127.32%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	148.83%	22.74%	+126.09%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	148.83%	22.74%	+126.09%

XDEF vs. NATO - Expense Ratio Comparison

Both XDEF and NATO have an expense ratio of 0.35%.

Dividends

XDEF vs. NATO - Dividend Comparison

XDEF's dividend yield for the trailing twelve months is around 1.51%, more than NATO's 0.43% yield.

Position	TTM	2025	2024
NATO Themes Transatlantic Defense ETF	0.43%	0.45%	0.08%
XDEF Xtrackers Europe Defense Technologies ETF	1.51%	0.00%	0.00%

Frequently Asked Questions

Can I hold both XDEF and NATO in my portfolio?

XDEF and NATO have a correlation of 0.82, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which ETF is better, XDEF or NATO?

Both ETFs have the same 0.35% expense ratio. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF is cheaper, XDEF or NATO?

XDEF and NATO have the same expense ratio: 0.35% per year.

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

XDEF has the higher dividend yield at 1.51%, compared with 0.43% for NATO.

What is the main difference between XDEF and NATO?

XDEF tracks STOXX Europe Total Market Defence, Space and Cybersecurity Innovation 50-25 Index, while NATO tracks Solactive Transatlantic Aerospace and Defense Index. They also come from different issuers: Xtrackers and Themes.