ZDB.TO vs. XSH.TO

Last updated Apr 1, 2026

Compare and contrast key facts about BMO Discount Bond (ZDB.TO) and iShares Core Canadian Short Term Corporate Bond Index ETF (XSH.TO).

ZDB.TO and XSH.TO are both exchange-traded funds (ETFs), meaning they are traded on stock exchanges and can be bought and sold throughout the day. ZDB.TO is a passively managed fund by BMO that tracks the performance of the FTSE Canada Universe Discount Bond Index. It was launched on Feb 10, 2014. XSH.TO is a passively managed fund by iShares that tracks the performance of the Morningstar Can 1-5Y Core Bd GR CAD. It was launched on Sep 13, 2011. Both ZDB.TO and XSH.TO are passive ETFs, meaning that they are not actively managed but aim to replicate the performance of the underlying index as closely as possible.

Performance

ZDB.TO vs. XSH.TO - Performance Comparison

The chart below illustrates the hypothetical performance of a CA$10,000 investment in BMO Discount Bond (ZDB.TO) and iShares Core Canadian Short Term Corporate Bond Index ETF (XSH.TO). The values are adjusted to include any dividend payments, if applicable.

ZDB.TO vs. XSH.TO - Yearly Performance Comparison

	2026 (YTD)	2025	2024	2023	2022	2021	2020	2019	2018	2017
ZDB.TO BMO Discount Bond	0.17%	2.03%	4.26%	6.69%	-11.99%	-2.77%	9.50%	6.74%	1.33%	2.00%
XSH.TO iShares Core Canadian Short Term Corporate Bond Index ETF	0.19%	4.61%	7.11%	6.80%	-4.52%	-0.81%	6.28%	5.02%	1.28%	0.78%

Returns By Period

In the year-to-date period, ZDB.TO achieves a 0.17% return, which is significantly lower than XSH.TO's 0.19% return. Over the past 10 years, ZDB.TO has underperformed XSH.TO with an annualized return of 1.58%, while XSH.TO has yielded a comparatively higher 2.78% annualized return.

ZDB.TO

• 1D: 0.33%
• 1M: -1.94%
• YTD: 0.17%
• 6M: -0.46%
• 1Y: 0.41%
• 3Y*: 3.25%
• 5Y*: 0.50%
• 10Y*: 1.58%

XSH.TO

• 1D: 0.26%
• 1M: -0.87%
• YTD: 0.19%
• 6M: 0.69%
• 1Y: 3.33%
• 3Y*: 5.53%
• 5Y*: 2.68%
• 10Y*: 2.78%

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

ZDB.TO vs. XSH.TO - Expense Ratio Comparison

Both ZDB.TO and XSH.TO have an expense ratio of 0.10%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.

ZDB.TO

BMO Discount Bond

XSH.TO

iShares Core Canadian Short Term Corporate Bond Index ETF

Return for Risk

ZDB.TO vs. XSH.TO — Risk / Return Rank

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

ZDB.TO

ZDB.TO Risk / Return Rank: 14
ZDB.TO Sharpe Ratio Rank: 14
ZDB.TO Sortino Ratio Rank: 12
ZDB.TO Omega Ratio Rank: 12
ZDB.TO Calmar Ratio Rank: 17
ZDB.TO Martin Ratio Rank: 15

XSH.TO

XSH.TO Risk / Return Rank: 84
XSH.TO Sharpe Ratio Rank: 84
XSH.TO Sortino Ratio Rank: 85
XSH.TO Omega Ratio Rank: 84
XSH.TO Calmar Ratio Rank: 83
XSH.TO Martin Ratio Rank: 85

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.

ZDB.TO vs. XSH.TO - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for BMO Discount Bond (ZDB.TO) and iShares Core Canadian Short Term Corporate Bond Index ETF (XSH.TO). 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.

	ZDB.TO	XSH.TO	Difference
Sharpe ratio Return per unit of total volatility	0.09	1.62	-1.53
Sortino ratio Return per unit of downside risk	0.15	2.23	-2.08
Omega ratio Gain probability vs. loss probability	1.02	1.32	-0.30
Calmar ratio Return relative to maximum drawdown	0.23	2.25	-2.01
Martin ratio Return relative to average drawdown	0.47	9.41	-8.94
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

ZDB.TO vs. XSH.TO - Sharpe Ratio Comparison

The current ZDB.TO Sharpe Ratio is 0.09, which is lower than the XSH.TO Sharpe Ratio of 1.62. The chart below compares the historical Sharpe Ratios of ZDB.TO and XSH.TO, offering insights into how both investments have performed under varying market conditions. These values are calculated using daily returns over the previous 12 months.

Sharpe Ratios by Period

	ZDB.TO	XSH.TO	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	0.09	1.62	-1.53
Sharpe Ratio (5Y) Calculated over the trailing 5-year period	0.08	0.97	-0.89
Sharpe Ratio (10Y) Calculated over the trailing 10-year period	0.25	0.63	-0.38
Sharpe Ratio (All Time) Calculated using the full available price history	0.37	0.73	-0.35

Correlation

The correlation between ZDB.TO and XSH.TO is 0.56, which is considered to be moderate. This suggests that the two assets have some degree of positive relationship in their price movements. Moderate correlation can be acceptable for portfolio diversification, offering a balance between risk and potential returns.

Dividends

ZDB.TO vs. XSH.TO - Dividend Comparison

ZDB.TO's dividend yield for the trailing twelve months is around 2.13%, less than XSH.TO's 3.89% yield.

	TTM	2025	2024	2023	2022	2021	2020	2019	2018	2017	2016	2015
ZDB.TO BMO Discount Bond	2.13%	2.28%	2.38%	2.42%	2.52%	2.16%	2.06%	2.20%	2.07%	2.06%	1.95%	1.99%
XSH.TO iShares Core Canadian Short Term Corporate Bond Index ETF	3.89%	3.82%	3.64%	3.24%	2.97%	2.65%	2.61%	2.80%	2.86%	2.93%	3.08%	3.18%

Drawdowns

ZDB.TO vs. XSH.TO - Drawdown Comparison

The maximum ZDB.TO drawdown since its inception was -18.09%, which is greater than XSH.TO's maximum drawdown of -14.24%. Use the drawdown chart below to compare losses from any high point for ZDB.TO and XSH.TO.

Drawdown Indicators

	ZDB.TO	XSH.TO	Difference
Max Drawdown Largest peak-to-trough decline	-18.09%	-14.24%	-3.85%
Max Drawdown (1Y) Largest decline over 1 year	-2.87%	-1.51%	-1.36%
Max Drawdown (5Y) Largest decline over 5 years	-16.25%	-7.80%	-8.45%
Max Drawdown (10Y) Largest decline over 10 years	-18.09%	-14.24%	-3.85%
Current Drawdown Current decline from peak	-2.76%	-0.87%	-1.89%
Average Drawdown Average peak-to-trough decline	-4.24%	-0.93%	-3.31%
Ulcer Index Depth and duration of drawdowns from previous peaks	1.43%	0.36%	+1.07%

Volatility

ZDB.TO vs. XSH.TO - Volatility Comparison

BMO Discount Bond (ZDB.TO) has a higher volatility of 1.95% compared to iShares Core Canadian Short Term Corporate Bond Index ETF (XSH.TO) at 1.15%. This indicates that ZDB.TO's price experiences larger fluctuations and is considered to be riskier than XSH.TO based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

Volatility by Period

	ZDB.TO	XSH.TO	Difference
Volatility (1M) Calculated over the trailing 1-month period	1.95%	1.15%	+0.80%
Volatility (6M) Calculated over the trailing 6-month period	3.06%	1.52%	+1.54%
Volatility (1Y) Calculated over the trailing 1-year period	4.64%	2.06%	+2.58%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	6.50%	2.79%	+3.71%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	6.39%	4.42%	+1.97%