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ETF Comparison

SGOV vs SHY: Which Is the Better Pick in 2026?

A head-to-head comparison of iShares 0-3 Month Treasury Bond ETF and iShares 1-3 Year Treasury Bond ETF covering yield, cost, risk, and income potential.

Data updated August 19, 2026

Best for

  • SGOVInvestors who want fixed-income ballast that steadies the portfolio when stocks fall.
  • SHYInvestors who want fixed-income ballast that steadies the portfolio when stocks fall.

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Visual comparison

Key metrics

Projected income on $10K

Projections assume the current yield and share price remain constant. Actual results will vary.

Total returns

SGOV has outpaced SHY over the trailing twelve months, posting a 3.83% total return against 2.59%. The lead holds up over 5 years too: SGOV has compounded at 3.70% a year, against 1.81% for SHY. SGOV has been the steadier holding, though — annualized volatility of 0.2% against 1.6% for SHY. Figures are total returns: price change plus every distribution reinvested.

Total return and risk statistics by fund. Each row is one fund; each column is one period or statistic.
SymbolYTD1Y3Y5YSince May 2020Volatility Sharpe Sortino Max drawdown
SGOV2.27%3.83%4.61%3.70%2.97%0.2%0.160.25-0.0%
SHY0.78%2.59%4.19%1.81%1.46%1.6%-0.23-0.33-1.0%

Total return with all distributions reinvested on the ex-dividend date, split-adjusted, as of August 19, 2026. YTD and 1Y are cumulative; longer windows are annualized. “Since May 2020” measures every fund from May 28, 2020 — the youngest fund's first trading day — so all funds share one comparison window. Volatility is the annualized standard deviation of daily total returns over the trailing 3 years. Sharpe and Sortino divide the annualized return in excess of the risk-free rate by, respectively, that volatility and the downside deviation (both over the trailing 3 years) — higher is better. Max drawdown is the largest peak-to-trough total-return decline over the same window — shallower is better.

Side-by-side snapshot

Side-by-side snapshot. Each row is one metric; each column is one fund.
MetricSGOVSHY
Full nameiShares 0-3 Month Treasury Bond ETFiShares 1-3 Year Treasury Bond ETF
IssueriSharesiShares
Last Close$100.57 as of August 19, 2026$82.02 as of August 19, 2026
Distribution yield3.66%3.67%
Distribution Safety Score™ 7374
Expense ratio0.09%0.15%
AUM$103B$25.5B
Distribution frequencyMonthlyMonthly
Underlying indexICE 0-3 Month US Treasury Securities IndexICE U.S. Treasury 1-3 Year Bond Index
ObjectiveSeeks to track an index of U.S. Treasury obligations maturing in three months or less, investing at least 90% of assets in U.S. Treasury securities.Tracks the ICE U.S. Treasury 1-3 Year Bond Index.
Asset classFixed IncomeFixed Income
Inception date05/26/202007/22/2002
Beta-0.00290.22
Last dividend$0.3070$0.2508
Ex-dividend date08/03/202608/03/2026

Bottom lineSGOV and SHY are both for investors who want fixed-income ballast that steadies the portfolio when stocks fall — so strategy isn't the deciding factor here. Fees and payouts are close too, so it comes down to which your broker offers commission-free and any share-price or tax-lot preference.

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See how much monthly income a hypothetical investment would generate in each ETF at current yields.

iShares
ETFs473
Total AUM$4710B

ETFs and AUM reflect what Dividend Vision tracks — the issuer's full lineup may be larger.

iShares is one of the largest ETF providers globally, known for offering a broad, diversified lineup of exchange-traded funds across multiple asset classes and investment strategies. The company operates 215 funds spanning 15 distinct families, including popular offerings in dividend income, covered call strategies, bonds, equities, ESG-focused investments, and factor-based approaches, with widely-held tickers like AGG (bond), ACWI (global equity), and AOA (allocation). iShares is characterized by its comprehensive fund ecosystem that serves both core portfolio holdings and specialized investment strategies, making it a prominent player for investors seeking both traditional and alternative income-generating ETF solutions.

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Quick verdict

SGOV (iShares 0-3 Month Treasury Bond ETF) and SHY (iShares 1-3 Year Treasury Bond ETF) are both monthly-pay dividend ETFs, but they take different approaches.

SHY offers the higher yield at 3.67% vs 3.66% for SGOV. A higher yield means more current income per dollar invested, though it may come with different risk characteristics.

SGOV is cheaper with an expense ratio of 0.09% compared to 0.15%.

They track different benchmarks: SGOV is linked to ICE 0-3 Month US Treasury Securities Index while SHY tracks ICE U.S. Treasury 1-3 Year Bond Index, which means their performance drivers differ.

SGOV is the larger fund by assets ($103B), which generally means tighter spreads and better liquidity.

Deep dive

Yield & income

On a $10,000 investment, SGOV would generate roughly $30.50/month, while SHY would produce $30.58/month, at current distribution rates. Both pay monthly distributions.

SGOV yield3.66%
SHY yield3.67%
Monthly diff on $10K$0.08

Cost & efficiency

Over 10 years on $10,000, SGOV would cost approximately $90 in fees vs $150 for SHY (simplified, not compounded). The $60.00 difference may be offset by yield or performance.

SGOV ER0.09%
SHY ER0.15%

Strategy & risk

SGOV tracks ICE 0-3 Month US Treasury Securities Index with a bonds approach, while SHY tracks ICE U.S. Treasury 1-3 Year Bond Index. Beta is -0.0029 for SGOV and 0.22 for SHY, making SGOV the less volatile of the two by this measure.

SGOV beta-0.0029
SHY beta0.22

Fund details

SGOV is managed by iShares (launched 05/26/2020) with $103B in assets. SHY is managed by iShares (launched 07/22/2002) with $25.5B in assets.

SGOV AUM$103B
SHY AUM$25.5B
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Frequently asked questions

What is the current distribution yield for SGOV and SHY?

SGOV currently distributes 3.66% and SHY 3.67%, based on fund data updated August 2026. Distribution yield moves with both the payout and the share price, so check the as-of date before relying on either figure.

Is SGOV or SHY better for dividend income?

It depends on your goals. SHY currently offers the higher distribution yield, which means more income per dollar invested. However, a lower-yield fund may offer better total return or lower volatility. Consider your time horizon and risk tolerance.

What is the difference between SGOV and SHY?

SGOV (iShares 0-3 Month Treasury Bond ETF) tracks ICE 0-3 Month US Treasury Securities Index with a bonds approach, while SHY (iShares 1-3 Year Treasury Bond ETF) tracks ICE U.S. Treasury 1-3 Year Bond Index. They are issued by iShares and iShares respectively.

Can I hold both SGOV and SHY?

Yes — nothing prevents holding both. Whether the combination actually diversifies depends on how much the underlying exposures overlap, which isn't fully measurable from the data on this page; review each security's holdings, sector, and strategy before treating them as complementary.

Is SGOV or SHY safer?

By Dividend Vision's Distribution Safety Score — a rules-based 0–100 estimate of how resilient a distribution looks, where higher is safer — they are effectively tied: SHY scores 74, SGOV scores 73. Neither has a clear safety edge on that measure. SGOV has also shown lower price volatility (beta -0.00 vs 0.22 for SHY). No score makes an investment risk-free — treat this as a screening signal, not a guarantee.

Which has lower fees, SGOV or SHY?

SGOV has an expense ratio of 0.09% while SHY charges 0.15%. Lower fees mean more of your investment returns stay in your pocket over time.

How much income does $10,000 in SGOV vs SHY generate?

At current rates, $10,000 in SGOV would generate roughly $30.50 per month ($366.00 annually). The same in SHY would produce about $30.58 per month ($367.00 annually).

Which has performed better historically, SGOV or SHY?

SGOV has outpaced SHY over the trailing twelve months, posting a 3.83% total return against 2.59%. The lead holds up over 5 years too: SGOV has compounded at 3.70% a year, against 1.81% for SHY. SGOV has been the steadier holding, though — annualized volatility of 0.2% against 1.6% for SHY. Figures are total returns: price change plus every distribution reinvested. Past performance does not guarantee future results.

More comparisons to explore

SGOV vs SHY — at a glance

Generated August 15, 2026.

Figures quoted in this analysis are from its generation date and may lag the live snapshot table above, which always shows the latest data.

Overview

SGOV and SHY are both Treasury ETFs from iShares that pay monthly distributions, but they target sharply different points on the maturity spectrum. SGOV holds Treasury bills maturing in three months or less, while SHY holds Treasury notes with 1–3 years to maturity. That difference drives everything else: duration risk, interest-rate sensitivity, and yield potential.

How they differ

The single biggest difference is maturity: SGOV's ultra-short duration (effectively cash-like, with a beta of −0.0029) versus SHY's 1–3 year duration (beta of 0.22). This means SHY will fluctuate more when interest rates move, while SGOV's price stays nearly flat. Despite similar distribution rates (SGOV 3.66%, SHY 3.67%), SHY's longer bonds carry more duration risk and offer more price-appreciation potential if rates fall. SGOV costs 0.07% annually to hold versus SHY's 0.15%, but SHY's $25.2B in AUM is well-established (inception 2002), while SGOV is newer (2020) but significantly larger at $99.9B.

Who each is best for

SGOV: Fits investors seeking a cash-equivalent holding that generates a yield above money-market accounts, with zero interest-rate risk and minimal price volatility. Works for very short time horizons or as a placeholder for capital awaiting deployment.

SHY: Fits investors comfortable with modest duration risk in exchange for slightly higher yield potential and the possibility of price appreciation if rates decline. Designed for intermediate-term Treasury exposure with monthly income.

Key risks to know

  • Duration and rate risk: SHY's 1–3 year maturity profile means its price will move inversely with interest rates—if rates rise, the fund's NAV falls, locking in losses for sellers. SGOV is largely insulated from this risk.
  • Reinvestment risk at rates compression: Both funds face reinvestment pressure if rates fall. SGOV's shorter maturities force more frequent rollover into lower-yielding instruments; SHY has longer to cushion rate declines but still rolls over regularly.
  • Opportunity cost in a rising-rate environment: If the Fed keeps rates elevated, both funds lock in current yields, but SHY's longer duration makes it a more visible drag versus holding cash or higher-yielding alternatives if rates stay steady.

Bottom line

If you want Treasury exposure with zero interest-rate risk and the lowest possible fees, SGOV's ultra-short duration and 0.07% expense ratio make it a natural fit. If you're willing to accept modest price volatility in exchange for a slightly longer yield cushion and potential capital appreciation when rates fall, SHY's track record and 1–3 year positioning offer more flexibility. Past performance does not predict future returns.

AI-generated analysis for educational purposes only. Verify important details independently; past performance does not guarantee future results.

Learn the method

The metrics behind this comparison, explained in the Academy.

Bond fund basics How to read a fund's stats Why total return beats chasing yield T-bills vs. money market funds vs. CDs

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