LQD vs. QUAL
LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF) and QUAL (iShares MSCI USA Quality Factor ETF) are both exchange-traded funds - LQD is a Corporate Bonds fund tracking the iBoxx $ Liquid Investment Grade Index, while QUAL is a Large Cap Blend Equities fund tracking the MSCI USA Sector Neutral Quality Index. Both are passively managed. Over the past 10 years, LQD returned 2.53%/yr vs 14.39%/yr for QUAL. At a 0.17 correlation, their price movements are largely independent. Both charge a 0.15% expense ratio.
Performance
LQD vs. QUAL - Performance Comparison
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Returns By Period
In the year-to-date period, LQD achieves a 0.88% return, which is significantly lower than QUAL's 8.93% return. Over the past 10 years, LQD has underperformed QUAL with an annualized return of 2.53%, while QUAL has yielded a comparatively higher 14.39% annualized return.
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%
QUAL
- 1D
- 1.68%
- 1M
- 2.62%
- YTD
- 8.93%
- 6M
- 7.97%
- 1Y
- 20.75%
- 3Y*
- 19.36%
- 5Y*
- 11.86%
- 10Y*
- 14.39%
LQD vs. QUAL - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
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% |
QUAL iShares MSCI USA Quality Factor ETF | 8.93% | 12.65% | 22.29% | 30.88% | -20.50% | 26.94% | 17.04% | 33.89% | -5.70% | 22.26% |
Correlation
The correlation between LQD and QUAL is 0.45, which is low. Their price movements are largely independent, making them effective diversification partners.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.45 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.35 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.34 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.25 |
Correlation (All Time) Calculated using the full available price history since Jul 18, 2013 | 0.17 |
Over the past year, LQD and QUAL have become more correlated (0.45) than their long-term average of 0.17, meaning their price movements have been converging.
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Return for Risk
LQD vs. QUAL — Risk / Return Rank
LQD
QUAL
LQD vs. QUAL - 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 MSCI USA Quality Factor ETF (QUAL). 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 | QUAL | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | -0.64 | ||
| Sortino ratioReturn per unit of downside risk | -0.84 | ||
| Omega ratioGain probability vs. loss probability | 1.19 | 1.30 | -0.12 |
| Calmar ratioReturn relative to maximum drawdown | 1.75 | 2.31 | -0.56 |
| Martin ratioReturn relative to average drawdown | 4.92 | 10.45 | -5.53 |
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Drawdowns
LQD vs. QUAL - Drawdown Comparison
The maximum LQD drawdown since its inception was -24.95%, smaller than the maximum QUAL drawdown of -34.06%. Use the drawdown chart below to compare losses from any high point for LQD and QUAL.
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Drawdown Indicators
| LQD | QUAL | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -24.95% | -34.06% | +9.11% |
Max Drawdown (1Y)Largest decline over 1 year | -3.34% | -9.03% | +5.69% |
Max Drawdown (3Y)Largest decline over 3 years | -8.43% | -18.00% | +9.57% |
Max Drawdown (5Y)Largest decline over 5 years | -24.95% | -28.23% | +3.28% |
Max Drawdown (10Y)Largest decline over 10 years | -24.95% | -34.06% | +9.11% |
Current DrawdownCurrent decline from peak | -3.31% | -0.66% | -2.65% |
Average DrawdownAverage peak-to-trough decline | -3.99% | -4.10% | +0.11% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.19% | 1.99% | -0.80% |
Volatility
LQD vs. QUAL - Volatility Comparison
The current volatility for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is 1.77%, while iShares MSCI USA Quality Factor ETF (QUAL) has a volatility of 3.61%. This indicates that LQD experiences smaller price fluctuations and is considered to be less risky than QUAL based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| LQD | QUAL | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.77% | 3.61% | -1.84% |
Volatility (6M)Calculated over the trailing 6-month period | 4.04% | 9.43% | -5.39% |
Volatility (1Y)Calculated over the trailing 1-year period | 5.38% | 12.10% | -6.72% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 8.65% | 17.37% | -8.72% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 8.69% | 18.11% | -9.42% |
LQD vs. QUAL - Expense Ratio Comparison
Both LQD and QUAL 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. QUAL - Dividend Comparison
LQD's dividend yield for the trailing twelve months is around 4.55%, more than QUAL's 0.87% yield.
| Position | TTM | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
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% |
QUAL iShares MSCI USA Quality Factor ETF | 0.87% | 0.94% | 1.02% | 1.23% | 1.59% | 1.20% | 1.39% | 1.60% | 2.00% | 1.76% | 1.96% | 1.63% |
Frequently Asked Questions
LQD and QUAL have a correlation of 0.45, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
QUAL has higher volatility (3.61%) compared to LQD (1.77%). In terms of maximum drawdown, LQD dropped -24.95% vs QUAL's -34.06%.
On 10-year performance, QUAL leads with 14.39% vs 2.53% for LQD. Both ETFs have the same 0.15% expense ratio. On volatility, LQD has been the lower-risk option at 1.77%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, QUAL has performed better with a 14.39% return vs 2.53%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
LQD and QUAL have the same expense ratio: 0.15% per year.
LQD has the higher dividend yield at 4.55%, compared with 0.87% for QUAL.
LQD is categorized as Corporate Bonds, while QUAL is Large Cap Blend Equities. LQD tracks iBoxx $ Liquid Investment Grade Index, while QUAL tracks MSCI USA Sector Neutral Quality Index.
QUAL currently has the higher Sharpe Ratio (1.72 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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