TLT vs SHY Stock Comparison: AI Score, Valuation, Performance and Upside
TLT and SHY represent opposite ends of the U.S. Treasury yield curve — TLT as the high-duration long-bond rate bet and SHY as the near-cash short-term Treasury stability vehicle. TLT provides large return potential (positive or negative) from rate direction, while SHY provides yield with minimal price volatility.
TLT vs SHY is the duration spectrum comparison in U.S. Treasuries — long-duration rate sensitivity versus short-duration stability, serving fundamentally different portfolio purposes along the yield curve.
SHY holds the edge across 1 of 5 key metrics in this comparison. SHY has delivered stronger 1-year price return (+1.62% vs -6.77% for TLT).
- Are making a rate-direction bet, expecting long-term interest rates to decline from current levels
- Want to hedge equity portfolio risk with an asset that historically performs well in recession and risk-off environments
- Need long-duration Treasury bond exposure for liability matching (pension funds, insurance) or duration management purposes
- Want a liquid, low-volatility U.S. Treasury exposure as a cash management alternative or short-term parking vehicle
- Seek near-zero interest rate duration risk in their bond allocation while still earning government bond yields
- Are waiting for better opportunities to deploy capital while maintaining liquidity and government bond safety
| Metric | TLT | SHY |
|---|---|---|
| ETF scorei | 14.0 | 35.0 |
| Latest closei | $79.32 | $81.21 |
| 1M returni | -4.41% | -0.73% |
| 6M returni | -5.21% | +0.34% |
| 1Y returni | -6.77% | +1.62% |
The ETF score weights long-term returns and risk-adjusted performance most heavily, but still rewards low expense ratios, larger fund size, and broader diversification — so it can favor low-cost, broad, mega-cap funds over smaller thematic or actively-managed funds even when the latter have delivered stronger returns.
How much would $10,000 be worth today if invested at the start of each period, with all dividends reinvested?
| Period | TLT | SHY |
|---|---|---|
| 1Y ago | $9.76K (-2.4%) started 2025-09-25 | $10.54K (+5.4%) started 2025-09-25 |
| 5Y ago | $7.84K (-21.6%) started 2021-09-27 | $12.74K (+27.4%) started 2021-09-27 |
| 10Y ago | $10.65K (+6.5%) started 2016-09-26 | $14.76K (+47.6%) started 2016-09-26 |
Hypothetical — past performance does not guarantee future results.
| Metric | TLT | SHY |
|---|---|---|
| Expense ratioi | N/A | 0.15% |
| Total assets (AUM)i | N/A | $25.91B |
| Dividend yieldi | N/A | 3.63% |
| Trailing P/Ei | N/A | N/A |
| Betai | N/A | 0.05 |
| 52-week change | -6.77% | 1.62% |
| Metric | TLT | SHY |
|---|---|---|
| 1Y returni | -6.77% | +1.62% |
| 6M returni | -5.21% | +0.34% |
| 1M returni | -4.41% | -0.73% |
| 1Y Sharpe ratio | -1.19 | -2.12 |
| Betai | N/A | 0.05 |
| Dividend yieldi | N/A | 3.63% |
| 5Y CAGR | -8.37% | +1.75% |
Over the past year, TLT and SHY have moved moderately in the same direction (correlation of 0.62), based on daily returns.
Lower drawdown and smaller single-period drops generally indicate a smoother ride, though they do not guarantee lower future risk.
| Period | Metric | TLT | SHY |
|---|---|---|---|
| 1Y | Growthi | -6.77% | +1.62% |
| CAGRi | -6.78% | +1.62% | |
| Volatilityi | 9.35% | 1.36% | |
| Sharpe ratioi | -1.19 | -2.12 | |
| Sortino ratioi | -1.57 | -2.61 | |
| Max drawdowni | 10.32% | 0.91% | |
| Current drawdowni | 10.32% | 0.76% | |
| Avg drawdowni | 4.04% | 0.18% | |
| Ulcer Indexi | 4.63% | 0.27% | |
| Max daily dropi | 1.90% | 0.30% | |
| Max wkly dropi | 2.96% | 0.48% | |
| 5Y | Growthi | -35.36% | +9.03% |
| CAGRi | -8.37% | +1.75% | |
| Volatilityi | 15.69% | 2.02% | |
| Sharpe ratioi | -0.77 | -1.36 | |
| Sortino ratioi | -1.05 | -1.87 | |
| Max drawdowni | 43.70% | 5.59% | |
| Current drawdowni | 38.93% | 0.76% | |
| Avg drawdowni | 30.64% | 1.46% | |
| Ulcer Indexi | 32.06% | 2.21% | |
| Max daily dropi | 3.42% | 0.51% | |
| Max wkly dropi | 6.42% | 1.26% | |
| 10Y | Growthi | -23.40% | +17.35% |
| CAGRi | -2.63% | +1.61% | |
| Volatilityi | 14.82% | 1.58% | |
| Sharpe ratioi | -0.41 | -1.82 | |
| Sortino ratioi | -0.57 | -2.48 | |
| Max drawdowni | 48.35% | 5.71% | |
| Current drawdowni | 43.98% | 0.76% | |
| Avg drawdowni | 22.34% | 0.89% | |
| Ulcer Indexi | 27.28% | 1.64% | |
| Max daily dropi | 6.67% | 0.51% | |
| Max wkly dropi | 7.78% | 1.26% |
| Category | TLT | SHY |
|---|---|---|
| Fund name | iShares 20+ Year Treasury Bond ETF | iShares 1-3 Year Treasury Bond ETF |
| Type | ETF | ETF |
| Expense ratioi | N/A | 0.15% |
| Total assets (AUM)i | N/A | $25.91B |
| Dividend yieldi | N/A | 3.63% |
- Zero credit risk — U.S. Treasury bonds carry the full faith and credit of the U.S. government, making TLT a pure interest rate product
- Significant positive total return potential when long-term interest rates fall (rates down = bond prices up)
- Classic flight-to-safety asset in equity bear markets as investors seek government bond safety and rates fall with slowing growth
- Very low duration (~2 years) means minimal price volatility from interest rate changes — much more stable NAV than TLT
- U.S. Treasury credit quality with slightly higher yield than money market funds or cash equivalents
- Highly liquid with tight bid-ask spreads — easy to enter and exit for cash management purposes
- Extreme interest rate sensitivity — TLT's long duration (17-20 years) means a 1% rise in rates causes roughly a 17-20% price decline
- Experienced major losses in 2022 when rates rose rapidly from near-zero — TLT fell over 30% in 2022
- Investors should understand TLT as a rate direction trade, not a stable fixed income allocation, unless they specifically need long-duration government bond exposure
- Short maturities mean SHY's yield closely tracks the Federal Reserve's short-term rate policy — when the Fed cuts rates, SHY's income yield quickly declines
- Very low total return potential compared to longer-duration bonds in rate-declining environments — SHY doesn't benefit much from rate cuts
- With near-zero interest rate risk, SHY is more of a cash management tool than a portfolio return generator
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