IEI vs. VGSH
IEI (iShares 3-7 Year Treasury Bond ETF) and VGSH (Vanguard Short-Term Treasury ETF) are both Government Bonds funds - IEI tracks the ICE U.S. Treasury 3-7 Year Bond Index while VGSH tracks the Bloomberg U.S. Treasury 1-3 Year Index. Both are passively managed. Over the past 10 years, IEI returned 1.28%/yr vs 1.74%/yr for VGSH. A 0.78 correlation means they provide meaningful diversification when combined. IEI charges 0.15%/yr vs 0.03%/yr for VGSH.
Performance
IEI vs. VGSH - Performance Comparison
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Returns By Period
In the year-to-date period, IEI achieves a -0.42% return, which is significantly lower than VGSH's 0.48% return. Over the past 10 years, IEI has underperformed VGSH with an annualized return of 1.28%, while VGSH has yielded a comparatively higher 1.74% annualized return.
IEI
- 1D
- -0.13%
- 1M
- -0.17%
- YTD
- -0.42%
- 6M
- -0.49%
- 1Y
- 3.28%
- 3Y*
- 3.52%
- 5Y*
- 0.23%
- 10Y*
- 1.28%
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%
IEI vs. VGSH - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
IEI iShares 3-7 Year Treasury Bond ETF | -0.42% | 6.96% | 1.81% | 4.42% | -9.51% | -2.54% | 6.95% | 5.71% | 1.36% | 1.22% |
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 IEI and VGSH is 0.94, 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 | 0.94 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.92 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.91 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.87 |
Correlation (All Time) Calculated using the full available price history since Nov 24, 2009 | 0.78 |
The correlation between IEI and VGSH shifts across timeframes, from 0.78 (all time) to 0.94 (1 year), reflecting how their relationship changes across market environments.
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Return for Risk
IEI vs. VGSH — Risk / Return Rank
IEI
VGSH
IEI vs. VGSH - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares 3-7 Year Treasury Bond ETF (IEI) 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.
| IEI | VGSH | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -1.59 | ||
| Sortino ratioReturn per unit of downside risk | -2.78 | ||
| Omega ratioGain probability vs. loss probability | 1.19 | 1.57 | -0.38 |
| Calmar ratioReturn relative to maximum drawdown | 1.32 | 3.90 | -2.58 |
| Martin ratioReturn relative to average drawdown | 3.96 | 15.52 | -11.56 |
Data is calculated on a 1-year rolling basis and updated daily. The trend shows the change in the indicator over the past month. | |||
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Sharpe Ratios by Period
| IEI | VGSH | Difference | |
|---|---|---|---|
Sharpe Ratio (1Y)Calculated over the trailing 1-year period | 1.09 | 2.68 | -1.59 |
Sharpe Ratio (5Y)Calculated over the trailing 5-year period | 0.05 | 0.93 | -0.88 |
Sharpe Ratio (10Y)Calculated over the trailing 10-year period | 0.33 | 1.11 | -0.78 |
Sharpe Ratio (All Time)Calculated using the full available price history | 0.70 | 1.01 | -0.32 |
Drawdowns
IEI vs. VGSH - Drawdown Comparison
The maximum IEI drawdown since its inception was -14.60%, which is greater than VGSH's maximum drawdown of -5.70%. Use the drawdown chart below to compare losses from any high point for IEI and VGSH.
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Drawdown Indicators
| IEI | VGSH | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -14.60% | -5.70% | -8.90% |
Max Drawdown (1Y)Largest decline over 1 year | -2.50% | -0.88% | -1.62% |
Max Drawdown (3Y)Largest decline over 3 years | -3.66% | -0.97% | -2.69% |
Max Drawdown (5Y)Largest decline over 5 years | -13.88% | -5.66% | -8.22% |
Max Drawdown (10Y)Largest decline over 10 years | -14.60% | -5.70% | -8.90% |
Current DrawdownCurrent decline from peak | -1.85% | -0.29% | -1.56% |
Average DrawdownAverage peak-to-trough decline | -2.67% | -0.60% | -2.07% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 0.83% | 0.22% | +0.61% |
Volatility
IEI vs. VGSH - Volatility Comparison
iShares 3-7 Year Treasury Bond ETF (IEI) has a higher volatility of 0.91% compared to Vanguard Short-Term Treasury ETF (VGSH) at 0.35%. This indicates that IEI'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
| IEI | VGSH | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 0.91% | 0.35% | +0.56% |
Volatility (6M)Calculated over the trailing 6-month period | 2.13% | 0.88% | +1.25% |
Volatility (1Y)Calculated over the trailing 1-year period | 3.04% | 1.29% | +1.75% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 4.77% | 1.97% | +2.80% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 3.93% | 1.57% | +2.36% |
IEI vs. VGSH - Expense Ratio Comparison
IEI 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
IEI vs. VGSH - Dividend Comparison
IEI's dividend yield for the trailing twelve months is around 3.64%, less than VGSH's 3.87% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IEI iShares 3-7 Year Treasury Bond ETF | 3.64% | 3.48% | 3.18% | 2.36% | 1.37% | 0.73% | 1.12% | 2.01% | 1.95% | 1.51% | 1.33% | 1.39% |
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
With a correlation of 0.94, IEI and VGSH move almost identically. Holding both adds very little diversification - you're essentially doubling your position in the same market segment. Choosing one is usually more capital-efficient.
IEI has higher volatility (0.91%) compared to VGSH (0.35%). In terms of maximum drawdown, IEI dropped -14.60% vs VGSH's -5.70%.
On 10-year performance, VGSH leads with 1.74% vs 1.28% for IEI. 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 1.28%. 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 IEI.
VGSH has the higher dividend yield at 3.87%, compared with 3.64% for IEI.
IEI tracks ICE U.S. Treasury 3-7 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 IEI and 0.03% for VGSH.
VGSH currently has the higher Sharpe Ratio (2.68 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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