ZTWO vs. TAXS

Last updated Jun 5, 2026

ZTWO (F/M 2-Year Investment Grade Corporate Bond ETF) and TAXS (Northern Trust Short-Term Tax-Exempt Bond 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 TAXS is a Municipal Bonds fund tracking the ICE Short Term Focused Municipal Bond Index. Both are passively managed. At a 0.46 correlation, their price movements are largely independent. ZTWO charges 0.15%/yr vs 0.05%/yr for TAXS.

Performance

ZTWO vs. TAXS - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in F/M 2-Year Investment Grade Corporate Bond ETF (ZTWO) and Northern Trust Short-Term Tax-Exempt Bond ETF (TAXS). The values are adjusted to include any dividend payments, if applicable.

Returns By Period

In the year-to-date period, ZTWO achieves a 0.93% return, which is significantly lower than TAXS's 0.99% return.

ZTWO

• 1D: 0.04%
• 1M: 0.28%
• YTD: 0.93%
• 6M: 1.30%
• 1Y: 3.94%
• 3Y*: —
• 5Y*: —
• 10Y*: —

TAXS

• 1D: 0.06%
• 1M: 0.59%
• YTD: 0.99%
• 6M: 1.39%
• 1Y: —
• 3Y*: —
• 5Y*: —
• 10Y*: —

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

ZTWO vs. TAXS - Yearly Performance Comparison

	2026 (YTD)	2025
ZTWO F/M 2-Year Investment Grade Corporate Bond ETF	0.93%	1.80%
TAXS Northern Trust Short-Term Tax-Exempt Bond ETF	0.99%	1.22%

Correlation

The correlation between ZTWO and TAXS is 0.46, which is low. Their price movements are largely independent, making them effective diversification partners.

	Correlation
Correlation (All Time) Calculated using the full available price history since Aug 20, 2025	0.46

Return for Risk

ZTWO vs. TAXS — Risk / Return Rank

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

ZTWO

ZTWO Risk / Return Rank: 90
ZTWO Sharpe Ratio Rank: 90
ZTWO Sortino Ratio Rank: 94
ZTWO Omega Ratio Rank: 93
ZTWO Calmar Ratio Rank: 82
ZTWO Martin Ratio Rank: 89

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.

ZTWO vs. TAXS - 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 Northern Trust Short-Term Tax-Exempt Bond ETF (TAXS). 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	TAXS	Difference
Sharpe ratio: Return per unit of total volatility	3.03	—	—
Sortino ratio: Return per unit of downside risk	4.86	—	—
Omega ratio: Gain probability vs. loss probability	1.63	—	—
Calmar ratio: Return relative to maximum drawdown	4.24	—	—
Martin ratio: Return relative to average drawdown	20.10	—	—
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

Sharpe Ratios by Period

	ZTWO	TAXS	Difference
Sharpe Ratio (1Y) Calculated over the trailing 1-year period	3.03	—	—
Sharpe Ratio (All Time) Calculated using the full available price history	3.17	2.85	+0.33

Drawdowns

ZTWO vs. TAXS - Drawdown Comparison

The maximum ZTWO drawdown since its inception was -0.93%, which is greater than TAXS's maximum drawdown of -0.84%. Use the drawdown chart below to compare losses from any high point for ZTWO and TAXS.

Drawdown Indicators

	ZTWO	TAXS	Difference
Max Drawdown Largest peak-to-trough decline	-0.93%	-0.84%	-0.09%
Max Drawdown (1Y) Largest decline over 1 year	-0.93%	—	—
Current Drawdown Current decline from peak	-0.07%	-0.03%	-0.04%
Average Drawdown Average peak-to-trough decline	-0.10%	-0.24%	+0.14%
Ulcer Index Depth and duration of drawdowns from previous peaks	0.20%	—	—

Volatility

Volatility by Period

	ZTWO	TAXS	Difference
Volatility (1M) Calculated over the trailing 1-month period	0.42%	—	—
Volatility (6M) Calculated over the trailing 6-month period	0.97%	—	—
Volatility (1Y) Calculated over the trailing 1-year period	1.31%	1.00%	+0.31%
Volatility (5Y) Calculated over the trailing 5-year period, annualized	1.49%	1.00%	+0.49%
Volatility (10Y) Calculated over the trailing 10-year period, annualized	1.49%	1.00%	+0.49%

ZTWO vs. TAXS - Expense Ratio Comparison

ZTWO has a 0.15% expense ratio, which is higher than TAXS's 0.05% 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. TAXS - Dividend Comparison

ZTWO's dividend yield for the trailing twelve months is around 4.12%, more than TAXS's 1.82% yield.

Position	TTM	2025	2024
TAXS Northern Trust Short-Term Tax-Exempt Bond ETF	1.82%	0.74%	0.00%
ZTWO F/M 2-Year Investment Grade Corporate Bond ETF	4.12%	4.31%	0.39%

Frequently Asked Questions

Can I hold both ZTWO and TAXS in my portfolio?

ZTWO and TAXS have a correlation of 0.46, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

Which ETF is better, ZTWO or TAXS?

On fees, TAXS is cheaper at 0.05% per year. The better choice depends on whether you care most about return, fees, risk, or income.

Which ETF is cheaper, ZTWO or TAXS?

TAXS is cheaper with a 0.05% expense ratio, compared with 0.15% for ZTWO.

Which ETF pays a higher dividend yield, ZTWO or TAXS?

ZTWO has the higher dividend yield at 4.12%, compared with 1.82% for TAXS.

What is the main difference between ZTWO and TAXS?

ZTWO is categorized as Short-Term Bond, while TAXS is Municipal Bonds. ZTWO tracks ICE 2-Year US Target Maturity Corporate Index - Benchmark TR Gross, while TAXS tracks ICE Short Term Focused Municipal Bond Index. They also come from different issuers: F/m and Northern Trust. Their fees differ too: 0.15% for ZTWO and 0.05% for TAXS.