FAAR vs TYO
FAAR vs TYO
First Trust Alternative Absolute Return Strategy ETF vs Direxion Daily 7-10 Year Treasury Bear 3X ETF
Quick Verdict
FAAR has a lower expense ratio. FAAR delivered stronger 1-year returns. TYO offers more diversification with 3 holdings.
Side-by-Side Comparison
| Metric | FAAR | TYO | Winner |
|---|---|---|---|
| Expense Ratio | 0.97% | 1.00% | |
| AUM | $191M | $12M | |
| Dividend Yield | 9.19% | 2.62% | |
| Holdings | 6 | 6 | |
| YTD Return | +13.94% | +10.84% | |
| 1Y Return | +19.26% | +11.31% | |
| 3Y Return (annualized) | +8.78% | +6.14% | |
| 5Y Return (annualized) | +7.33% | +14.69% | |
| Volatility (annualized) | 9.2% | 19.3% | |
| Max Drawdown | -18.8% | -90.4% | |
| Fund Family | First Trust Portfolios (US) | Direxion Shares ETF Trust | |
| Category | Commodity | Alternative | |
| Inception | May 18, 2016 | Apr 16, 2009 |
FAAR vs TYO Performance
First Trust Alternative Absolute Return Strategy ETF (FAAR) is a ETF from First Trust Portfolios (US) and Direxion Daily 7-10 Year Treasury Bear 3X ETF (TYO) is a ETF from Direxion Shares ETF Trust. Over the past year FAAR returned +19.26% while TYO returned +11.31%. Year to date, FAAR is up 13.94% versus a gain of 10.84% for TYO.
Over three years, FAAR compounded at +8.78% per year against +6.14% for TYO; over five years the annualized figures are +7.33% and +14.69% respectively. Across the full 10-year window we track, FAAR has the edge at +3.32% annualized vs -7.26%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
TYO has been the more volatile fund, with annualized monthly volatility of 19.3% compared with 9.2% for FAAR. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -18.8% for FAAR and -90.4% for TYO. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.17. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
FAAR charges 0.97% per year while TYO charges 1.00%. On a $10,000 position that is $97 vs $100 annually, a gap of $3 per year that compounds over a long holding period. On income, FAAR currently yields 9.19% against 2.62% for TYO.
Holdings Overlap
FAAR and TYO share 0 holdings out of 4 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, FAAR or TYO?
FAAR has an expense ratio of 0.97% while TYO charges 1.00%. FAAR is the cheaper option. On a $10,000 investment, that is $3 per year of difference.
Which performed better, FAAR or TYO?
Over the past year FAAR returned +19.26% vs +11.31% for TYO, so FAAR leads on 1-year performance. Over the longest common window we track (10 years), FAAR annualized +3.32% vs -7.26% for TYO. Past performance does not guarantee future results.
Which is riskier, FAAR or TYO?
TYO has been the more volatile fund at 19.3% annualized versus 9.2% for FAAR. Worst drawdown: FAAR -18.8% vs TYO -90.4%.
Should I hold both FAAR and TYO?
FAAR and TYO have a monthly-return correlation of 0.17, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between FAAR and TYO?
FAAR and TYO share 0 common holdings with a 0.0% weight overlap. Combined, they hold 4 unique securities.
Which pays a higher dividend, FAAR or TYO?
FAAR yields 9.19% while TYO yields 2.62%, so FAAR currently pays the higher dividend yield.
Popular ETF Comparisons
Get Full ETF Analytics
Access complete holdings data, overlap analysis, screener tools, and more with FundXLS.