IEI vs. LQD
IEI (iShares 3-7 Year Treasury Bond ETF) and LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF) are both exchange-traded funds - IEI is a Government Bonds fund tracking the ICE U.S. Treasury 3-7 Year Bond Index, while LQD is a Corporate Bonds fund tracking the iBoxx $ Liquid Investment Grade Index. Both are passively managed. Over the past 10 years, IEI returned 1.25%/yr vs 2.53%/yr for LQD. A 0.70 correlation means they provide meaningful diversification when combined. Both charge a 0.15% expense ratio.
Performance
IEI vs. LQD - Performance Comparison
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Returns By Period
In the year-to-date period, IEI achieves a -0.18% return, which is significantly lower than LQD's 0.88% return. Over the past 10 years, IEI has underperformed LQD with an annualized return of 1.25%, while LQD has yielded a comparatively higher 2.53% annualized return.
IEI
- 1D
- 0.43%
- 1M
- 0.16%
- YTD
- -0.18%
- 6M
- 0.03%
- 1Y
- 3.35%
- 3Y*
- 3.65%
- 5Y*
- 0.24%
- 10Y*
- 1.25%
LQD
- 1D
- 0.85%
- 1M
- 0.86%
- YTD
- 0.88%
- 6M
- 0.69%
- 1Y
- 5.82%
- 3Y*
- 5.17%
- 5Y*
- -0.20%
- 10Y*
- 2.53%
IEI vs. LQD - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IEI iShares 3-7 Year Treasury Bond ETF | -0.18% | 6.96% | 1.81% | 4.42% | -9.51% | -2.54% | 6.95% | 5.71% | 1.36% | 1.22% |
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | 0.88% | 7.90% | 0.86% | 9.40% | -17.92% | -1.84% | 10.97% | 17.37% | -3.79% | 7.06% |
Correlation
The correlation between IEI and LQD is 0.82, 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 | 0.82 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.85 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.83 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.77 |
Correlation (All Time) Calculated using the full available price history since Jan 11, 2007 | 0.70 |
The correlation between IEI and LQD shifts across timeframes, from 0.70 (all time) to 0.85 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
IEI vs. LQD — Risk / Return Rank
IEI
LQD
IEI vs. LQD - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares 3-7 Year Treasury Bond ETF (IEI) and iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD). 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.
Values are calculated on a 1-year rolling basis and updated daily. Risk-adjusted metrics are more stable over longer periods — use the period switch above to explore them.
| IEI | LQD | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.04 | ||
| Sortino ratioReturn per unit of downside risk | +0.11 | ||
| Omega ratioGain probability vs. loss probability | 1.20 | 1.19 | +0.01 |
| Calmar ratioReturn relative to maximum drawdown | 1.35 | 1.75 | -0.40 |
| Martin ratioReturn relative to average drawdown | 3.80 | 4.92 | -1.11 |
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Drawdowns
IEI vs. LQD - Drawdown Comparison
The maximum IEI drawdown since its inception was -14.60%, smaller than the maximum LQD drawdown of -24.95%. Use the drawdown chart below to compare losses from any high point for IEI and LQD.
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Drawdown Indicators
| IEI | LQD | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -14.60% | -24.95% | +10.35% |
Max Drawdown (1Y)Largest decline over 1 year | -2.50% | -3.34% | +0.84% |
Max Drawdown (3Y)Largest decline over 3 years | -3.66% | -8.43% | +4.77% |
Max Drawdown (5Y)Largest decline over 5 years | -13.88% | -24.95% | +11.07% |
Max Drawdown (10Y)Largest decline over 10 years | -14.60% | -24.95% | +10.35% |
Current DrawdownCurrent decline from peak | -1.62% | -3.31% | +1.69% |
Average DrawdownAverage peak-to-trough decline | -2.67% | -3.99% | +1.32% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.88% | 1.19% | -0.31% |
Volatility
IEI vs. LQD - Volatility Comparison
The current volatility for iShares 3-7 Year Treasury Bond ETF (IEI) is 0.97%, while iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) has a volatility of 1.77%. This indicates that IEI experiences smaller price fluctuations and is considered to be less risky than LQD based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| IEI | LQD | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 0.97% | 1.77% | -0.80% |
Volatility (6M)Calculated over the trailing 6-month period | 2.19% | 4.04% | -1.85% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.01% | 5.38% | -2.37% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 4.78% | 8.65% | -3.87% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 3.93% | 8.69% | -4.76% |
IEI vs. LQD - Expense Ratio Comparison
Both IEI and LQD have an expense ratio of 0.15%, making them cost-effective options compared to the broader market, where average expense ratios typically range from 0.3% to 0.9%.
Dividends
IEI vs. LQD - Dividend Comparison
IEI's dividend yield for the trailing twelve months is around 3.63%, less than LQD's 4.55% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IEI iShares 3-7 Year Treasury Bond ETF | 3.63% | 3.48% | 3.18% | 2.36% | 1.37% | 0.73% | 1.12% | 2.01% | 1.95% | 1.51% | 1.33% | 1.39% |
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | 4.55% | 4.48% | 4.45% | 3.99% | 3.30% | 2.30% | 2.66% | 3.29% | 3.67% | 3.10% | 3.34% | 3.47% |
Frequently Asked Questions
IEI and LQD have a correlation of 0.82, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
LQD has higher volatility (1.77%) compared to IEI (0.97%). In terms of maximum drawdown, IEI dropped -14.60% vs LQD's -24.95%.
On 10-year performance, LQD leads with 2.53% vs 1.25% for IEI. Both ETFs have the same 0.15% expense ratio. On volatility, IEI has been the lower-risk option at 0.97%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, LQD has performed better with a 2.53% return vs 1.25%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
IEI and LQD have the same expense ratio: 0.15% per year.
LQD has the higher dividend yield at 4.55%, compared with 3.63% for IEI.
IEI is categorized as Government Bonds, while LQD is Corporate Bonds. IEI tracks ICE U.S. Treasury 3-7 Year Bond Index, while LQD tracks iBoxx $ Liquid Investment Grade Index.
IEI currently has the higher Sharpe Ratio (1.12 vs 1.09), 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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