TIP vs Short Treasury (SHY)
Live side-by-side comparison with current values, changes, and key statistics.
Why This Comparison Matters
TIP holds mid to long duration TIPS while SHY holds 1-3 year nominal Treasuries. The ratio captures both duration and inflation premium. TIP outperformance signals falling real yields and rising inflation expectations. SHY outperformance aligns with rising real yields or falling breakeven inflation.
Cross-Asset Analysis
TIPS (TIP) (iShares TIPS Bond ETF, inflation-protected Treasuries) and 1-3Y Treasury (SHY) (iShares 1-3 Year Treasury Bond ETF, short duration) are priced in separate markets, yet their co-movement tells macro desks something neither series reveals alone. Structural changes inside TIPS (TIP) or 1-3Y Treasury (SHY), such as index reconstitution or methodology shifts, can break historical spread relationships in discrete jumps. Flows matter for the TIPS (TIP)-1-3Y Treasury (SHY) relationship: when one peer attracts more capital, it outperforms on demand pressure that usually mean-reverts.
Inside the Bonds & Duration universe, TIPS (TIP) and 1-3Y Treasury (SHY) represent different flavors of the same underlying exposure. Performance attribution leans on TIPS (TIP)-1-3Y Treasury (SHY) spreads to separate security selection from style allocation inside multi-manager mandates. Index construction choices inside TIPS (TIP) and 1-3Y Treasury (SHY), including weighting methodology and inclusion rules, create persistent tilts that show up in the spread.
TIPS (TIP) and 1-3Y Treasury (SHY) occupy the same asset class, and the relative performance between them isolates the specific factor that distinguishes one from the other. The TIPS (TIP)-1-3Y Treasury (SHY) spread captures the tilt between two variants of the same asset: one may be more defensive, one more cyclical.
90-Day Statistics
No data available
No data available
Explore Each Metric
Related Scenarios & Forecasts
Get daily macro analysis comparing key metrics delivered to your inbox. Stay ahead of market-moving divergences.
Frequently Asked Questions
What is the relationship between TIPS (TIP) and 1-3Y Treasury (SHY)?+
TIPS (TIP) and 1-3Y Treasury (SHY) are connected through shared asset class exposure with different factor tilts. When the underlying asset class shifts, both respond, though with different sensitivities and at different speeds. The spread between TIPS (TIP) and 1-3Y Treasury (SHY) captures the specific macro signal that flows through this relationship.
When does TIPS (TIP) typically lead 1-3Y Treasury (SHY)?+
TIPS (TIP) tends to lead 1-3Y Treasury (SHY) during rotation episodes between the two factor exposures. In those periods, moves in TIPS (TIP) precede corresponding moves in 1-3Y Treasury (SHY) by days to weeks, depending on the transmission channel and the depth of each market.
How are TIPS (TIP) and 1-3Y Treasury (SHY) historically correlated?+
Long-run correlation between TIPS (TIP) and 1-3Y Treasury (SHY) varies by regime. Peers in the same asset class are highly correlated in direction, with the spread reflecting factor tilts and rotation dynamics. The correlation is not stable: it shifts with macro conditions, and the periods when it breaks down are often the most informative moments in the TIPS (TIP)-1-3Y Treasury (SHY) relationship.
What macro conditions drive divergence between TIPS (TIP) and 1-3Y Treasury (SHY)?+
Divergence between TIPS (TIP) and 1-3Y Treasury (SHY) typically arises from index reconstitution, mega-cap earnings surprises, or liquidity differences between the peers. When one asset's idiosyncratic drivers dominate, the spread moves in ways that the common macro story does not predict, which is usually a signal to look more carefully at the specific drivers at work in TIPS (TIP) or 1-3Y Treasury (SHY).
Is TIPS (TIP) a hedge for 1-3Y Treasury (SHY)?+
Peers like TIPS (TIP) and 1-3Y Treasury (SHY) do not hedge each other; both rise or fall with the shared asset class, and using the pair as a spread trade is different from using it as a hedge. Effective hedging requires matching the hedge to the specific risk being protected, and the TIPS (TIP)-1-3Y Treasury (SHY) pair is best stress-tested under scenarios the investor most worries about before being sized into a real portfolio.
Related Comparisons
Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.