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IEF vs. VGSH
Performance
Return for Risk
Drawdowns
Volatility
Dividends

IEF vs. VGSH

Last updated Jun 4, 2026

IEF (iShares 7-10 Year Treasury Bond ETF) and VGSH (Vanguard Short-Term Treasury ETF) are both Government Bonds funds - IEF tracks the ICE U.S. Treasury 7-10 Year Bond Index while VGSH tracks the Bloomberg U.S. Treasury 1-3 Year Index. Both are passively managed. Over the past 10 years, IEF returned 0.63%/yr vs 1.74%/yr for VGSH. A 0.70 correlation means they provide meaningful diversification when combined. IEF charges 0.15%/yr vs 0.03%/yr for VGSH.

Performance

IEF vs. VGSH - Performance Comparison

The chart below illustrates the hypothetical performance of a $10,000 investment in iShares 7-10 Year Treasury Bond ETF (IEF) and Vanguard Short-Term Treasury ETF (VGSH). The values are adjusted to include any dividend payments, if applicable.

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Returns By Period

In the year-to-date period, IEF achieves a -0.66% return, which is significantly lower than VGSH's 0.48% return. Over the past 10 years, IEF has underperformed VGSH with an annualized return of 0.63%, while VGSH has yielded a comparatively higher 1.74% annualized return.

IEF

1D
-0.25%
1M
-0.08%
YTD
-0.66%
6M
-1.17%
1Y
4.06%
3Y*
2.47%
5Y*
-1.14%
10Y*
0.63%

VGSH

1D
-0.03%
1M
0.08%
YTD
0.48%
6M
0.74%
1Y
3.43%
3Y*
4.15%
5Y*
1.81%
10Y*
1.74%
*Multi-year figures are annualized to reflect compound growth (CAGR)

IEF vs. VGSH - Yearly Performance Comparison

2026 (YTD)202520242023202220212020201920182017
IEF
iShares 7-10 Year Treasury Bond ETF		-0.66%8.03%-0.63%3.64%-15.15%-3.33%10.01%8.03%0.99%2.55%
VGSH
Vanguard Short-Term Treasury ETF		0.48%5.07%4.00%4.31%-3.86%-0.60%3.04%3.52%1.55%0.04%

Correlation

The correlation between IEF and VGSH is 0.86, indicating a strong positive relationship between their price movements. Combining them offers limited diversification - they tend to fall together during downturns.

Correlation
Correlation (1Y)
Calculated over the trailing 1-year period

0.86

Correlation (3Y)
Calculated over the trailing 3-year period

0.82

Correlation (5Y)
Calculated over the trailing 5-year period

0.82

Correlation (10Y)
Calculated over the trailing 10-year period

0.78

Correlation (All Time)
Calculated using the full available price history since Nov 24, 2009

0.70

The correlation between IEF and VGSH shifts across timeframes, from 0.70 (all time) to 0.86 (1 year), reflecting how their relationship changes across market environments.

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iShares 7-10 Year Treasury Bond ETF

Vanguard Short-Term Treasury ETF

Often compared with IEF:
IEF vs. TLTIEF vs. VGITIEF vs. LQDIEF vs. SHYIEF vs. BNDIEF vs. IEIIEF vs. TIP
Often compared with VGSH:
VGSH vs. sgovVGSH vs. SHVVGSH vs. SHYVGSH vs. SGOVVGSH vs. BNDVGSH vs. VTIPVGSH vs. VCSH

Return for Risk

IEF vs. VGSH — Risk / Return Rank

Compare risk-adjusted metric ranks to identify better-performing investments over the past 12 months.
IEF
IEF Risk / Return Rank: 2323
Overall Rank
IEF Sharpe Ratio Rank: 2424
Sharpe Ratio Rank
IEF Sortino Ratio Rank: 2323
Sortino Ratio Rank
IEF Omega Ratio Rank: 2121
Omega Ratio Rank
IEF Calmar Ratio Rank: 2222
Calmar Ratio Rank
IEF Martin Ratio Rank: 2323
Martin Ratio Rank
VGSH
VGSH Risk / Return Rank: 8383
Overall Rank
VGSH Sharpe Ratio Rank: 8181
Sharpe Ratio Rank
VGSH Sortino Ratio Rank: 9191
Sortino Ratio Rank
VGSH Omega Ratio Rank: 8888
Omega Ratio Rank
VGSH Calmar Ratio Rank: 7676
Calmar Ratio Rank
VGSH Martin Ratio Rank: 7878
Martin Ratio Rank
The rank (0–100) shows how this investment's returns compare to the risk taken. Higher = better. Based on the past 12 months of data, combining Sharpe, Sortino, and other metrics used by quantitative funds and institutional investors.

IEF vs. VGSH - Risk-Adjusted Trends Comparison

This table presents a comparison of risk-adjusted performance metrics for iShares 7-10 Year Treasury Bond ETF (IEF) and Vanguard Short-Term Treasury ETF (VGSH). Risk-adjusted metrics are performance indicators that assess an investment's returns in relation to its risk, enabling a more accurate comparison of different investment options.

IEFVGSHDifference
Sharpe ratioReturn per unit of total volatility
0.85
2.68

-1.82

Sortino ratioReturn per unit of downside risk
1.29
4.43

-3.14

Omega ratioGain probability vs. loss probability

1.15

1.57

-0.42

Calmar ratioReturn relative to maximum drawdown

1.00

3.90

-2.89

Martin ratioReturn relative to average drawdown

2.98

15.52

-12.54

Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month.

IEF vs. VGSH - Sharpe Ratio Comparison

The current IEF Sharpe Ratio is 0.85, which is lower than the VGSH Sharpe Ratio of 2.68. The chart below compares the historical Sharpe Ratios of IEF and VGSH, calculated using daily returns over the previous 12 months. A higher Sharpe Ratio indicates better risk-adjusted performance relative to the risk-free rate.

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Sharpe Ratios by Period

IEFVGSHDifference

Sharpe Ratio (1Y)

Calculated over the trailing 1-year period

0.85

2.68

-1.82

Sharpe Ratio (5Y)

Calculated over the trailing 5-year period

-0.15

0.93

-1.07

Sharpe Ratio (10Y)

Calculated over the trailing 10-year period

0.10

1.11

-1.01

Sharpe Ratio (All Time)

Calculated using the full available price history

0.50

1.01

-0.51

Drawdowns

IEF vs. VGSH - Drawdown Comparison

The maximum IEF drawdown since its inception was -23.93%, which is greater than VGSH's maximum drawdown of -5.70%. Use the drawdown chart below to compare losses from any high point for IEF and VGSH.

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Drawdown Indicators

IEFVGSHDifference

Max Drawdown

Largest peak-to-trough decline

-23.93%

-5.70%

-18.23%

Max Drawdown (1Y)

Largest decline over 1 year

-4.07%

-0.88%

-3.19%

Max Drawdown (3Y)

Largest decline over 3 years

-7.74%

-0.97%

-6.77%

Max Drawdown (5Y)

Largest decline over 5 years

-21.40%

-5.66%

-15.74%

Max Drawdown (10Y)

Largest decline over 10 years

-23.93%

-5.70%

-18.23%

Current Drawdown

Current decline from peak

-11.35%

-0.29%

-11.06%

Average Drawdown

Average peak-to-trough decline

-5.34%

-0.60%

-4.74%

Ulcer Index

Depth and duration of drawdowns from previous peaks

1.37%

0.22%

+1.15%

Volatility

IEF vs. VGSH - Volatility Comparison

iShares 7-10 Year Treasury Bond ETF (IEF) has a higher volatility of 1.54% compared to Vanguard Short-Term Treasury ETF (VGSH) at 0.35%. This indicates that IEF's price experiences larger fluctuations and is considered to be riskier than VGSH based on this measure. The chart below showcases a comparison of their rolling one-month volatility.

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Volatility by Period

IEFVGSHDifference

Volatility (1M)

Calculated over the trailing 1-month period

1.54%

0.35%

+1.19%

Volatility (6M)

Calculated over the trailing 6-month period

3.34%

0.88%

+2.46%

Volatility (1Y)

Calculated over the trailing 1-year period

4.78%

1.29%

+3.49%

Volatility (5Y)

Calculated over the trailing 5-year period, annualized

7.71%

1.97%

+5.74%

Volatility (10Y)

Calculated over the trailing 10-year period, annualized

6.62%

1.57%

+5.05%

IEF vs. VGSH - Expense Ratio Comparison

IEF has a 0.15% expense ratio, which is higher than VGSH's 0.03% expense ratio. However, both funds are considered low-cost compared to the broader market, where average expense ratios usually range from 0.3% to 0.9%.

Dividends

IEF vs. VGSH - Dividend Comparison

IEF's dividend yield for the trailing twelve months is around 3.90%, which matches VGSH's 3.87% yield.

PositionTTM20252024202320222021202020192018201720162015
IEF
iShares 7-10 Year Treasury Bond ETF		3.90%3.77%3.62%2.91%1.96%0.83%1.08%2.08%2.24%1.82%1.81%1.90%
VGSH
Vanguard Short-Term Treasury ETF		3.87%4.00%4.18%3.31%1.15%0.66%1.74%2.28%1.79%1.10%0.84%0.69%

Frequently Asked Questions

IEF and VGSH have a correlation of 0.86, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.

IEF has higher volatility (1.54%) compared to VGSH (0.35%). In terms of maximum drawdown, IEF dropped -23.93% vs VGSH's -5.70%.

On 10-year performance, VGSH leads with 1.74% vs 0.63% for IEF. On fees, VGSH is cheaper at 0.03% per year. On volatility, VGSH has been the lower-risk option at 0.35%. The better choice depends on whether you care most about return, fees, risk, or income.

Over the 10-year period, VGSH has performed better with a 1.74% return vs 0.63%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.

VGSH is cheaper with a 0.03% expense ratio, compared with 0.15% for IEF.

IEF has the higher dividend yield at 3.90%, compared with 3.87% for VGSH.

IEF tracks ICE U.S. Treasury 7-10 Year Bond Index, while VGSH tracks Bloomberg U.S. Treasury 1-3 Year Index. They also come from different issuers: iShares and Vanguard. Their fees differ too: 0.15% for IEF and 0.03% for VGSH.

VGSH currently has the higher Sharpe Ratio (2.68 vs 0.85), meaning it's delivered slightly more return per unit of risk over the trailing 12 months. However, this ranking shifts over time - use the Risk/Return Score above for a more comprehensive view that combines Sharpe, Sortino, and other measures used by quantitative funds.

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