SHY vs VYM
iShares 1-3 Year Treasury Bond ETF vs Vanguard High Dividend Yield ETF
Quick Verdict
VYM has a lower expense ratio. VYM delivered stronger 1-year returns. VYM offers more diversification with 558 holdings.
Side-by-Side Comparison
| Metric | SHY | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.15% | 0.04% | |
| AUM | $25.2B | $79.0B | |
| Dividend Yield | 3.68% | 2.86% | |
| Holdings | 91 | 568 | |
| YTD Return | +0.61% | +16.53% | |
| 1Y Return | +2.40% | +25.03% | |
| 3Y Return (annualized) | +4.26% | +18.54% | |
| 5Y Return (annualized) | +1.85% | +12.25% | |
| Volatility (annualized) | 1.5% | 14.6% | |
| Max Drawdown | -6.1% | -58.8% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Jul 22, 2002 | Nov 10, 2006 |
SHY vs VYM Performance
iShares 1-3 Year Treasury Bond ETF (SHY) is a ETF from iShares by BlackRock (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year SHY returned +2.40% while VYM returned +25.03%. Year to date, SHY is up 0.61% versus a gain of 16.53% for VYM.
Over three years, SHY compounded at +4.26% per year against +18.54% for VYM; over five years the annualized figures are +1.85% and +12.25% respectively. Across the full 20-year window we track, VYM has the edge at +7.10% annualized vs +0.63%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.6% compared with 1.5% for SHY. 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 -6.1% for SHY and -58.8% for VYM. 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 -0.05. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
SHY charges 0.15% per year while VYM charges 0.04%. On a $10,000 position that is $15 vs $4 annually, a gap of $11 per year that compounds over a long holding period. On income, SHY currently yields 3.68% against 2.86% for VYM.
Holdings Overlap
SHY and VYM share 0 holdings out of 632 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, SHY or VYM?
SHY has an expense ratio of 0.15% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $11 per year of difference.
Which performed better, SHY or VYM?
Over the past year SHY returned +2.40% vs +25.03% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), SHY annualized +0.63% vs +7.10% for VYM. Past performance does not guarantee future results.
Which is riskier, SHY or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 1.5% for SHY. Worst drawdown: SHY -6.1% vs VYM -58.8%.
Should I hold both SHY and VYM?
SHY and VYM have a monthly-return correlation of -0.05, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between SHY and VYM?
SHY and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 632 unique securities.
Which pays a higher dividend, SHY or VYM?
SHY yields 3.68% while VYM yields 2.86%, so SHY 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.