IYJ vs IYT: Which ETF Is Better in 2026?
A metric-by-metric comparison of iShares U.S. Industrials ETF (IYJ) and iShares Transportation Average ETF (IYT) — both Industrials funds — using ETFValuer's daily-updated rankings.
Educational content — not financial advice. Data as of July 29, 2026. ~5 minute read.
The Verdict
IYJ and IYT compete directly — both are Industrials funds chasing the same job in a portfolio. That makes this a genuine either/or: the index each tracks, what it costs, and how it has handled drawdowns are what separate them, not the broad exposure they give you.
On ETFValuer's overall model — which blends return, risk-adjusted performance, cost, drawdown, size and volatility — IYT scores higher: 54.7 (Grade C) versus 51.6 for IYJ. That doesn't make IYJ a bad fund; it means IYT currently edges it out on this specific mix of factors. Read the metric-by-metric breakdown below before deciding which matters more for your own portfolio.
Head-to-Head: Every Metric
| IYJ | IYT | |
|---|---|---|
| Category | Industrials | Industrials |
| Expense ratio | 0.38% | 0.38% |
| Fund size (AUM) | $1.9B | $2.3B |
| Dividend yield | 0.56% | 2.17% |
| 1-year return | +10.34% | +21.83% |
| 3-year return | +53.99% | +36.95% |
| Volatility | 15.99% | 20.52% |
| Max drawdown | -19.67% | -26.35% |
| Sharpe ratio | 0.33 | 0.82 |
| ETFValuer score | 51.6 | 54.7 |
| Grade | C | C |
| Overall rank | #370 | #332 |
Bold marks the better value in each row. "Better" is directional only (e.g. lower cost, higher return) — it isn't a recommendation by itself. See the full methodology.
Cost
On cost, the two are essentially tied — IYJ charges 0.38% a year versus IYT's 0.38%. A difference this small (about $0.00 a year on a $10,000 position) isn't a reason to choose one fund over the other.
What IYJ's Fees Cost You
IYJ charges an expense ratio of 0.38% a year, deducted automatically from the fund's value. Small percentages compound into real money — adjust the figures below to see the impact on your own numbers.
Assumes a constant gross return and no additional contributions — a simplification, but it isolates exactly what the expense ratio costs. Try the full fee calculator to model contributions and compare any two funds.
Performance & Risk
Over the trailing 3 years, IYJ returned +53.99% versus +36.95% for IYT — a gap of about 17.0 percentage points. On risk, IYJ has held up better historically, with a shallower max drawdown (-19.67% vs. -26.35%). IYT currently has the better risk-adjusted return (Sharpe ratio of 0.82 vs. 0.33), meaning it delivered more return per unit of volatility taken on.
How Closely Do They Track Each Other?
Over the last 3.0 years of daily returns (751 shared trading days), IYJ and IYT show a strong correlation of 0.813 — clearly related, with room to diverge. There is some genuine differentiation here, but not enough to call these complementary holdings. Pairing them mostly concentrates risk rather than spreading it.
| Measure | Value | What it means |
|---|---|---|
| Daily return correlation | 0.813 | Strong — clearly related, with room to diverge |
| R-squared | 66.1% | 66.1% of IYJ's daily moves are explained by IYT's |
| Tracking error (annualised) | 12.59% | Typical yearly spread between the two funds' returns |
| Annualised return over 3.0y | IYJ +15.14% · IYT +10.03% | IYJ ahead by 5.12 points a year |
Correlation alone understates how far these can drift. Across every rolling 12-month window in the period, IYJ finished as much as +17.6 points ahead of IYT at the best extreme and -18.1 points at the worst — a 35.7-point spread between the best and worst year of relative performance. Two funds can correlate tightly day to day and still deliver very different outcomes over any single year you happen to hold them.
Calculated from daily total returns over the trailing 3-year window, recomputed every day this site refreshes. Correlation of 1.00 means the two funds moved in lockstep; 0.00 means their daily moves were unrelated.
Holdings Overlap
IYJ and IYT hold 1 of the same companies among their top 10 positions. Those shared names make up 2.0% of IYJ and 16.5% of IYT. That's modest duplication — the funds are mostly distinct at the top, so holding both can still add diversification.
| Shared Holding | IYJ Weight | IYT Weight |
|---|---|---|
| UNION PACIFIC CORPORATION | 2.03% | 16.51% |
Compares the top 10 reported holdings from each fund's most recent SEC N-PORT-P filing, so it understates total overlap — funds tracking similar indexes overlap far more deeply than the top 10 alone can show. Search any company across all tracked funds with the Stock Overlap tool.
Which One Should You Pick?
Lean IYJ if…
- It has been the calmer ride (16.0% volatility vs 20.5%) with a shallower worst-case fall (-19.7% vs -26.4%)
- You weight recent results heavily — it returned 54.0% over 3 years against 37.0%
Lean IYT if…
- Current income matters to you — it yields 2.17% against 0.56%
- You care about return per unit of risk — its Sharpe ratio of 0.82 beats 0.33
Whichever you pick, holding both at full weight is usually the wrong answer — see the overlap and correlation sections above.
Frequently Asked Questions
Is IYJ or IYT better?
On ETFValuer's overall model — which blends return, risk-adjusted performance, cost, drawdown, size and volatility — IYT scores higher: 54.7 (Grade C) versus 51.6 for IYJ. That doesn't make IYJ a bad fund; it means IYT currently edges it out on this specific mix of factors. Read the metric-by-metric breakdown below before deciding which matters more for your own portfolio.
Which has the lower expense ratio, IYJ or IYT?
IYT currently has the lower expense ratio (0.38% vs. 0.38%).
Can I hold both IYJ and IYT?
Yes, and it may be worth doing. IYJ and IYT correlate at only 0.81 over the past 3.0 years, so they behave differently enough that holding both is a genuine diversification decision rather than a redundant one. Size each to the role you want it to play.
Go deeper on either fund
Full daily-updated metrics, holdings context, and category peers.