LQD vs. IEF
LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF) and IEF (iShares 7-10 Year Treasury Bond ETF) are both exchange-traded funds - LQD is a Corporate Bonds fund tracking the iBoxx $ Liquid Investment Grade Index, while IEF is a Government Bonds fund tracking the ICE U.S. Treasury 7-10 Year Bond Index. Both are passively managed. Over the past 10 years, LQD returned 2.11%/yr vs 0.40%/yr for IEF. Their 0.76 correlation means they have sometimes moved together and sometimes differently. Both charge a 0.15% expense ratio.
Performance
LQD vs. IEF - Performance Comparison
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Returns By Period
The year-to-date returns for both stocks are quite close, with LQD having a -1.39% return and IEF slightly lower at -1.44%. Over the past 10 years, LQD has outperformed IEF with an annualized return of 2.11%, while IEF has yielded a comparatively lower 0.40% annualized return.
LQD
- 1D
- -0.15%
- 1M
- -2.20%
- 6M
- -1.73%
- YTD
- -1.39%
- 1Y
- 0.96%
- 3Y*
- 4.37%
- 5Y*
- -1.03%
- 10Y*
- 2.11%
- ALL TIME*
- 4.35%
IEF
- 1D
- -0.28%
- 1M
- -1.24%
- 6M
- -1.22%
- YTD
- -1.44%
- 1Y
- 0.62%
- 3Y*
- 2.88%
- 5Y*
- -1.80%
- 10Y*
- 0.40%
- ALL TIME*
- 3.34%
Liquidity Comparison
| Position | Avg. Volume Value (2W) | Avg. Volume Value (1M) | Avg. Volume Value (3M) |
|---|---|---|---|
| $422.02M | $484.34M | $621.73M | |
| $3.33B | $3.16B | $3.02B |
LQD vs. IEF - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | -1.39% | 7.90% | 0.86% | 9.40% | -17.92% | -1.84% | 10.97% | 17.37% | -3.79% | 7.06% |
IEF iShares 7-10 Year Treasury Bond ETF | -1.44% | 8.03% | -0.63% | 3.64% | -15.15% | -3.33% | 10.01% | 8.03% | 0.99% | 2.55% |
Correlation
The correlation between LQD and IEF is 0.89, meaning they have usually moved in the same direction, including during past declines.
| Correlation | |
|---|---|
Correlation (1Y) Focuses on recent behavior, but can change the most. | 0.89 |
Correlation (3Y) Balances recent behavior with more history. | 0.92 |
Correlation (5Y) Shows whether the relationship held over a longer period. | 0.89 |
Correlation (10Y) Provides a long-term view across more market conditions. | 0.82 |
Correlation (All Time) Calculated using the full available price history since Jul 26, 2002 | 0.76 |
The correlation between LQD and IEF shifts across timeframes, from 0.76 (all time) to 0.92 (3 years), reflecting how their relationship changes across market environments.
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Return for Risk
LQD vs. IEF — Risk / Return Rank
LQD
IEF
LQD vs. IEF - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) and iShares 7-10 Year Treasury Bond ETF (IEF). 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.
| LQD | IEF | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.03 | ||
| Sortino ratioReturn per unit of downside risk | -0.05 | ||
| Omega ratioGain probability vs. loss probability | 1.06 | 1.07 | 0.00 |
| Calmar ratioReturn relative to maximum drawdown | 0.56 | 0.44 | +0.12 |
| Martin ratioReturn relative to average drawdown | 1.37 | 1.01 | +0.35 |
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Drawdowns
LQD vs. IEF - Drawdown Comparison
The maximum LQD drawdown since its inception was -24.95%, roughly equal to the maximum IEF drawdown of -23.93%. Use the drawdown chart below to compare losses from any high point for LQD and IEF.
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Drawdown Indicators
| LQD | IEF | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -24.95% | -23.93% | -1.02% |
Max Drawdown (1Y)Largest decline over 1 year | -3.34% | -4.07% | +0.73% |
Max Drawdown (3Y)Largest decline over 3 years | -6.73% | -6.89% | +0.16% |
Max Drawdown (5Y)Largest decline over 5 years | -24.95% | -21.38% | -3.57% |
Max Drawdown (10Y)Largest decline over 10 years | -24.95% | -23.93% | -1.02% |
Current DrawdownCurrent decline from peak | -5.49% | -12.05% | +6.56% |
Average DrawdownAverage peak-to-trough decline | -3.99% | -5.38% | +1.39% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.36% | 1.75% | -0.39% |
Volatility
LQD vs. IEF - Volatility Comparison
iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) has a higher volatility of 1.37% compared to iShares 7-10 Year Treasury Bond ETF (IEF) at 1.18%. This indicates that LQD's price experiences larger fluctuations and is considered to be riskier than IEF based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| LQD | IEF | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.37% | 1.18% | +0.19% |
Volatility (6M)Calculated over the trailing 6-month period | 4.08% | 3.64% | +0.44% |
Volatility (1Y)Calculated over the trailing 1-year period | 5.28% | 4.67% | +0.61% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 8.64% | 7.70% | +0.94% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 8.69% | 6.61% | +2.08% |
LQD vs. IEF - Expense Ratio Comparison
Both LQD and IEF 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
LQD vs. IEF - Dividend Comparison
LQD's dividend yield for the trailing twelve months is around 4.65%, more than IEF's 3.95% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
IEF iShares 7-10 Year Treasury Bond ETF | 3.62% | 3.77% | 3.62% | 2.91% | 1.96% | 0.83% | 1.08% | 2.08% | 2.24% | 1.82% | 1.81% | 1.90% |
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | 4.23% | 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
LQD and IEF have a correlation of 0.89, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
LQD has higher volatility (1.37%) compared to IEF (1.18%). In terms of maximum drawdown, LQD dropped -24.95% vs IEF's -23.93%.
On 10-year performance, LQD leads with 2.11% vs 0.40% for IEF. Both ETFs have the same 0.15% expense ratio. On volatility, IEF has been the lower-risk option at 1.18%. 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 2.11% return vs 0.40%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
LQD and IEF have the same expense ratio: 0.15% per year.
LQD has the higher dividend yield at 4.23%, compared with 3.62% for IEF.
LQD is categorized as Corporate Bonds, while IEF is Government Bonds. LQD tracks iBoxx $ Liquid Investment Grade Index, while IEF tracks ICE U.S. Treasury 7-10 Year Bond Index.
IEF currently has the higher Sharpe Ratio (0.38 vs 0.35), 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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