ZTWO vs. SCHO
ZTWO (F/M 2-Year Investment Grade Corporate Bond ETF) and SCHO (Schwab Short-Term U.S. Treasury ETF) are both exchange-traded funds - ZTWO is a Short-Term Bond fund tracking the ICE 2-Year US Target Maturity Corporate Index - Benchmark TR Gross, while SCHO is a Government Bonds fund tracking the Bloomberg U.S. Treasury 1-3 Year Index. Both are passively managed. Over the past year, ZTWO returned 3.94% vs 3.35% for SCHO. A 0.76 correlation means they provide meaningful diversification when combined. ZTWO charges 0.15%/yr vs 0.03%/yr for SCHO.
Performance
ZTWO vs. SCHO - Performance Comparison
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Returns By Period
In the year-to-date period, ZTWO achieves a 0.93% return, which is significantly higher than SCHO's 0.50% return.
ZTWO
- 1D
- 0.04%
- 1M
- 0.28%
- YTD
- 0.93%
- 6M
- 1.30%
- 1Y
- 3.94%
- 3Y*
- —
- 5Y*
- —
- 10Y*
- —
SCHO
- 1D
- 0.08%
- 1M
- 0.10%
- YTD
- 0.50%
- 6M
- 0.90%
- 1Y
- 3.35%
- 3Y*
- 4.16%
- 5Y*
- 1.82%
- 10Y*
- 1.72%
ZTWO vs. SCHO - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | |
|---|---|---|---|
ZTWO F/M 2-Year Investment Grade Corporate Bond ETF | 0.93% | 5.49% | 0.36% |
SCHO Schwab Short-Term U.S. Treasury ETF | 0.50% | 5.49% | -0.08% |
Correlation
The correlation between ZTWO and SCHO is 0.79, which is moderate. They share some common price drivers but move independently often enough to provide real diversification benefit when combined.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.79 |
Correlation (All Time) Calculated using the full available price history since Dec 20, 2024 | 0.76 |
The correlation between ZTWO and SCHO has been stable across timeframes, ranging from 0.76 to 0.79 - a consistent structural relationship.
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Return for Risk
ZTWO vs. SCHO — Risk / Return Rank
ZTWO
SCHO
ZTWO vs. SCHO - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for F/M 2-Year Investment Grade Corporate Bond ETF (ZTWO) and Schwab Short-Term U.S. Treasury ETF (SCHO). 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.
| ZTWO | SCHO | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.58 | ||
| Sortino ratioReturn per unit of downside risk | +0.85 | ||
| Omega ratioGain probability vs. loss probability | 1.63 | 1.49 | +0.14 |
| Calmar ratioReturn relative to maximum drawdown | 4.24 | 3.91 | +0.32 |
| Martin ratioReturn relative to average drawdown | 20.10 | 16.82 | +3.28 |
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month. | |||
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Sharpe Ratios by Period
| ZTWO | SCHO | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 3.03 | 2.46 | +0.58 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | — | 0.92 | — |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | — | 1.11 | — |
Sharpe Ratio (All Time)Calculated using the full available price history | 3.17 | 1.00 | +2.17 |
Drawdowns
ZTWO vs. SCHO - Drawdown Comparison
The maximum ZTWO drawdown since its inception was -0.93%, smaller than the maximum SCHO drawdown of -5.69%. Use the drawdown chart below to compare losses from any high point for ZTWO and SCHO.
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Drawdown Indicators
| ZTWO | SCHO | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -0.93% | -5.69% | +4.76% |
Max Drawdown (1Y)Largest decline over 1 year | -0.93% | -0.86% | -0.07% |
Max Drawdown (3Y)Largest decline over 3 years | — | -0.98% | — |
Max Drawdown (5Y)Largest decline over 5 years | — | -5.69% | — |
Max Drawdown (10Y)Largest decline over 10 years | — | -5.69% | — |
Current DrawdownCurrent decline from peak | -0.07% | -0.18% | +0.11% |
Average DrawdownAverage peak-to-trough decline | -0.10% | -0.61% | +0.51% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.20% | 0.20% | 0.00% |
Volatility
ZTWO vs. SCHO - Volatility Comparison
F/M 2-Year Investment Grade Corporate Bond ETF (ZTWO) and Schwab Short-Term U.S. Treasury ETF (SCHO) have volatilities of 0.42% and 0.42%, 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
| ZTWO | SCHO | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 0.42% | 0.42% | 0.00% |
Volatility (6M)Calculated over the trailing 6-month period | 0.97% | 0.91% | +0.06% |
Volatility (1Y)Calculated over the trailing 1-year period | 1.31% | 1.37% | -0.06% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 1.49% | 1.98% | -0.49% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 1.49% | 1.56% | -0.07% |
ZTWO vs. SCHO - Expense Ratio Comparison
ZTWO has a 0.15% expense ratio, which is higher than SCHO's 0.03% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.
Dividends
ZTWO vs. SCHO - Dividend Comparison
ZTWO's dividend yield for the trailing twelve months is around 4.12%, more than SCHO's 3.90% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
SCHO Schwab Short-Term U.S. Treasury ETF | 3.90% | 4.06% | 4.29% | 3.76% | 1.34% | 0.41% | 1.27% | 2.27% | 1.60% | 1.12% | 0.82% | 0.68% |
ZTWO F/M 2-Year Investment Grade Corporate Bond ETF | 4.12% | 4.31% | 0.39% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Frequently Asked Questions
ZTWO and SCHO have a correlation of 0.79, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
SCHO has higher volatility (0.42%) compared to ZTWO (0.42%). In terms of maximum drawdown, ZTWO dropped -0.93% vs SCHO's -5.69%.
On 1-year performance, ZTWO leads with 3.94% vs 3.35% for SCHO. On fees, SCHO is cheaper at 0.03% per year. Their volatility is very similar. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 1-year period, ZTWO has performed better with a 3.94% return vs 3.35%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
SCHO is cheaper with a 0.03% expense ratio, compared with 0.15% for ZTWO.
ZTWO has the higher dividend yield at 4.12%, compared with 3.90% for SCHO.
ZTWO is categorized as Short-Term Bond, while SCHO is Government Bonds. ZTWO tracks ICE 2-Year US Target Maturity Corporate Index - Benchmark TR Gross, while SCHO tracks Bloomberg U.S. Treasury 1-3 Year Index. They also come from different issuers: F/m and Charles Schwab. Their fees differ too: 0.15% for ZTWO and 0.03% for SCHO.
ZTWO currently has the higher Sharpe Ratio (3.03 vs 2.46), 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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