LQD vs. XLP
LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF) and XLP (State Street Consumer Staples Select Sector SPDR ETF) are both exchange-traded funds - LQD is a Corporate Bonds fund tracking the iBoxx $ Liquid Investment Grade Index, while XLP is a Consumer Staples Equities fund tracking the Consumer Staples Select Sector Index. Both are passively managed. Over the past 10 years, LQD returned 2.54%/yr vs 7.60%/yr for XLP. At a 0.07 correlation, their price movements are largely independent. LQD charges 0.15%/yr vs 0.08%/yr for XLP.
Performance
LQD vs. XLP - Performance Comparison
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Returns By Period
In the year-to-date period, LQD achieves a 0.82% return, which is significantly lower than XLP's 11.10% return. Over the past 10 years, LQD has underperformed XLP with an annualized return of 2.54%, while XLP has yielded a comparatively higher 7.60% annualized return.
LQD
- 1D
- -0.06%
- 1M
- 0.80%
- YTD
- 0.82%
- 6M
- 1.24%
- 1Y
- 5.80%
- 3Y*
- 5.30%
- 5Y*
- -0.21%
- 10Y*
- 2.54%
XLP
- 1D
- 0.65%
- 1M
- 0.99%
- YTD
- 11.10%
- 6M
- 9.54%
- 1Y
- 8.93%
- 3Y*
- 8.26%
- 5Y*
- 6.65%
- 10Y*
- 7.60%
LQD vs. XLP - Yearly Performance Comparison
| 2026 (YTD) | 2025 | 2024 | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | |
|---|---|---|---|---|---|---|---|---|---|---|
LQD iShares iBoxx $ Investment Grade Corporate Bond ETF | 0.82% | 7.90% | 0.86% | 9.40% | -17.92% | -1.84% | 10.97% | 17.37% | -3.79% | 7.06% |
XLP State Street Consumer Staples Select Sector SPDR ETF | 11.10% | 1.52% | 12.20% | -0.82% | -0.81% | 17.20% | 10.11% | 27.43% | -8.07% | 12.98% |
Correlation
The correlation between LQD and XLP is 0.17, which is low. Their price movements are largely independent, making them effective diversification partners.
| Correlation | |
|---|---|
Correlation (1Y) Calculated over the trailing 1-year period | 0.17 |
Correlation (3Y) Calculated over the trailing 3-year period | 0.25 |
Correlation (5Y) Calculated over the trailing 5-year period | 0.27 |
Correlation (10Y) Calculated over the trailing 10-year period | 0.24 |
Correlation (All Time) Calculated using the full available price history since Jul 26, 2002 | 0.07 |
The correlation between LQD and XLP shifts across timeframes, from 0.07 (all time) to 0.27 (5 years), reflecting how their relationship changes across market environments.
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Return for Risk
LQD vs. XLP — Risk / Return Rank
LQD
XLP
LQD vs. XLP - Risk-Adjusted Trends Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) and State Street Consumer Staples Select Sector SPDR ETF (XLP). 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 | XLP | Difference | |
|---|---|---|---|
| Sharpe ratioReturn per unit of total volatility | +0.38 | ||
| Sortino ratioReturn per unit of downside risk | +0.50 | ||
| Omega ratioGain probability vs. loss probability | 1.17 | 1.11 | +0.06 |
| Calmar ratioReturn relative to maximum drawdown | 1.55 | 0.79 | +0.76 |
| Martin ratioReturn relative to average drawdown | 4.37 | 1.52 | +2.85 |
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Drawdowns
LQD vs. XLP - Drawdown Comparison
The maximum LQD drawdown since its inception was -24.95%, smaller than the maximum XLP drawdown of -35.90%. Use the drawdown chart below to compare losses from any high point for LQD and XLP.
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Drawdown Indicators
| LQD | XLP | Difference | |
|---|---|---|---|
Max DrawdownLargest peak-to-trough decline | -24.95% | -35.90% | +10.95% |
Max Drawdown (1Y)Largest decline over 1 year | -3.34% | -9.69% | +6.35% |
Max Drawdown (3Y)Largest decline over 3 years | -8.43% | -12.39% | +3.96% |
Max Drawdown (5Y)Largest decline over 5 years | -24.95% | -16.30% | -8.65% |
Max Drawdown (10Y)Largest decline over 10 years | -24.95% | -24.51% | -0.44% |
Current DrawdownCurrent decline from peak | -3.37% | -4.12% | +0.75% |
Average DrawdownAverage peak-to-trough decline | -3.99% | -7.06% | +3.07% |
Ulcer IndexDepth and duration of drawdowns from previous peaks | 1.19% | 5.01% | -3.82% |
Volatility
LQD vs. XLP - Volatility Comparison
The current volatility for iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is 1.78%, while State Street Consumer Staples Select Sector SPDR ETF (XLP) has a volatility of 4.53%. This indicates that LQD experiences smaller price fluctuations and is considered to be less risky than XLP based on this measure. The chart below showcases a comparison of their rolling one-month volatility.
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Volatility by Period
| LQD | XLP | Difference | |
|---|---|---|---|
Volatility (1M)Calculated over the trailing 1-month period | 1.78% | 4.53% | -2.75% |
Volatility (6M)Calculated over the trailing 6-month period | 4.02% | 10.14% | -6.12% |
Volatility (1Y)Calculated over the trailing 1-year period | 5.37% | 12.90% | -7.53% |
Volatility (5Y)Calculated over the trailing 5-year period, annualized | 8.65% | 13.34% | -4.69% |
Volatility (10Y)Calculated over the trailing 10-year period, annualized | 8.69% | 14.75% | -6.06% |
LQD vs. XLP - Expense Ratio Comparison
LQD has a 0.15% expense ratio, which is higher than XLP's 0.08% 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
LQD vs. XLP - Dividend Comparison
LQD's dividend yield for the trailing twelve months is around 4.55%, more than XLP's 2.53% 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% |
XLP State Street Consumer Staples Select Sector SPDR ETF | 2.53% | 2.75% | 2.77% | 2.63% | 2.47% | 2.28% | 2.50% | 2.57% | 3.04% | 2.62% | 2.53% | 2.52% |
Frequently Asked Questions
LQD and XLP have a correlation of 0.17, meaning they provide meaningful diversification benefit when combined. Depending on your allocation goals, holding both could reduce overall portfolio risk.
XLP has higher volatility (4.53%) compared to LQD (1.78%). In terms of maximum drawdown, LQD dropped -24.95% vs XLP's -35.90%.
On 10-year performance, XLP leads with 7.60% vs 2.54% for LQD. On fees, XLP is cheaper at 0.08% per year. On volatility, LQD has been the lower-risk option at 1.78%. The better choice depends on whether you care most about return, fees, risk, or income.
Over the 10-year period, XLP has performed better with a 7.60% return vs 2.54%. Past performance does not guarantee future results, so compare this with risk, fees, and fund exposure.
XLP is cheaper with a 0.08% expense ratio, compared with 0.15% for LQD.
LQD has the higher dividend yield at 4.55%, compared with 2.53% for XLP.
LQD is categorized as Corporate Bonds, while XLP is Consumer Staples Equities. LQD tracks iBoxx $ Liquid Investment Grade Index, while XLP tracks Consumer Staples Select Sector Index. They also come from different issuers: iShares and State Street. Their fees differ too: 0.15% for LQD and 0.08% for XLP.
LQD currently has the higher Sharpe Ratio (0.97 vs 0.59), 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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