LQD vs. VCLT
Compare and contrast key facts about iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) and Vanguard Long-Term Corporate Bond ETF (VCLT).
LQD and VCLT are both exchange-traded funds (ETFs), meaning they are traded on stock exchanges and can be bought and sold throughout the day. LQD is a passively managed fund by iShares that tracks the performance of the iBoxx $ Liquid Investment Grade Index. It was launched on Jul 26, 2002. VCLT is a passively managed fund by Vanguard that tracks the performance of the Barclays U.S. 10+ Year Corporate Index. It was launched on Nov 19, 2009. Both LQD and VCLT are passive ETFs, meaning that they are not actively managed but aim to replicate the performance of the underlying index as closely as possible.
Scroll down to visually compare performance, riskiness, drawdowns, and other indicators and decide which better suits your portfolio: LQD or VCLT.
Key characteristics
| LQD | VCLT | |
|---|---|---|
| YTD Return | 1.49% | -0.36% |
| 1Y Return | 8.69% | 10.04% |
| 3Y Return (Ann) | -2.74% | -5.87% |
| 5Y Return (Ann) | 0.13% | -1.30% |
| 10Y Return (Ann) | 2.48% | 2.63% |
| Sharpe Ratio | 1.29 | 1.03 |
| Sortino Ratio | 1.89 | 1.51 |
| Omega Ratio | 1.22 | 1.18 |
| Calmar Ratio | 0.54 | 0.42 |
| Martin Ratio | 4.41 | 3.11 |
| Ulcer Index | 2.18% | 3.63% |
| Daily Std Dev | 7.42% | 10.91% |
| Max Drawdown | -24.95% | -34.31% |
| Current Drawdown | -10.62% | -19.64% |
Correlation
The correlation between LQD and VCLT is 0.89, which is considered to be high. That indicates a strong positive relationship between their price movements. Having highly-correlated positions in a portfolio may signal a lack of diversification, potentially leading to increased risk during market downturns.
Performance
LQD vs. VCLT - Performance Comparison
In the year-to-date period, LQD achieves a 1.49% return, which is significantly higher than VCLT's -0.36% return. Over the past 10 years, LQD has underperformed VCLT with an annualized return of 2.48%, while VCLT has yielded a comparatively higher 2.63% annualized return. The chart below displays the growth of a $10,000 investment in both assets, with all prices adjusted for splits and dividends.
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LQD vs. VCLT - Expense Ratio Comparison
LQD has a 0.15% expense ratio, which is higher than VCLT's 0.04% 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%.
Risk-Adjusted Performance
LQD vs. VCLT - Risk-Adjusted Performance Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) and Vanguard Long-Term Corporate Bond ETF (VCLT). 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.
Dividends
LQD vs. VCLT - Dividend Comparison
LQD's dividend yield for the trailing twelve months is around 4.41%, less than VCLT's 5.01% yield.
| TTM | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | 4.41% | 3.99% | 3.30% | 2.30% | 2.66% | 3.29% | 3.67% | 3.10% | 3.34% | 3.47% | 3.39% | 3.83% |
VCLT Vanguard Long-Term Corporate Bond ETF | 5.01% | 4.67% | 4.44% | 3.07% | 3.16% | 3.81% | 4.55% | 4.01% | 4.33% | 4.68% | 4.29% | 4.83% |
Drawdowns
LQD vs. VCLT - Drawdown Comparison
The maximum LQD drawdown since its inception was -24.95%, smaller than the maximum VCLT drawdown of -34.31%. Use the drawdown chart below to compare losses from any high point for LQD and VCLT. For additional features, visit the drawdowns tool.
Volatility
LQD vs. VCLT - Volatility Comparison
The current volatility for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is 2.49%, while Vanguard Long-Term Corporate Bond ETF (VCLT) has a volatility of 3.85%. This indicates that LQD experiences smaller price fluctuations and is considered to be less risky than VCLT based on this measure. The chart below showcases a comparison of their rolling one-month volatility.