TIP vs. DBC
Compare and contrast key facts about iShares TIPS Bond ETF (TIP) and Invesco DB Commodity Index Tracking Fund (DBC).
TIP and DBC are both exchange-traded funds (ETFs), meaning they are traded on stock exchanges and can be bought and sold throughout the day. TIP is a passively managed fund by iShares that tracks the performance of the Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index (Series-L). It was launched on Dec 4, 2003. DBC is a passively managed fund by Invesco that tracks the performance of the DBIQ Optimum Yield Diversified Commodity Index Excess Return. It was launched on Feb 3, 2006. Both TIP and DBC 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: TIP or DBC.
Key characteristics
| TIP | DBC | |
|---|---|---|
| YTD Return | -1.53% | 7.35% |
| 1Y Return | -1.25% | 6.35% |
| 3Y Return (Ann) | -1.62% | 11.73% |
| 5Y Return (Ann) | 1.90% | 9.63% |
| 10Y Return (Ann) | 1.80% | -0.32% |
| Sharpe Ratio | -0.26 | 0.46 |
| Daily Std Dev | 5.99% | 14.14% |
| Max Drawdown | -14.56% | -76.36% |
| Current Drawdown | -10.78% | -43.78% |
Correlation
The correlation between TIP and DBC is 0.05, which is considered to be low. This implies their price changes are not closely related. A low correlation is generally favorable for portfolio diversification, as it helps to reduce overall risk by spreading it across multiple assets with different performance patterns.
Performance
TIP vs. DBC - Performance Comparison
In the year-to-date period, TIP achieves a -1.53% return, which is significantly lower than DBC's 7.35% return. Over the past 10 years, TIP has outperformed DBC with an annualized return of 1.80%, while DBC has yielded a comparatively lower -0.32% 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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TIP vs. DBC - Expense Ratio Comparison
TIP has a 0.19% expense ratio, which is lower than DBC's 0.85% expense ratio.
Risk-Adjusted Performance
TIP vs. DBC - Risk-Adjusted Performance Comparison
This table presents a comparison of risk-adjusted performance metrics for iShares TIPS Bond ETF (TIP) and Invesco DB Commodity Index Tracking Fund (DBC). 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
TIP vs. DBC - Dividend Comparison
TIP's dividend yield for the trailing twelve months is around 2.72%, less than DBC's 4.60% yield.
| TTM | 2023 | 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
TIP iShares TIPS Bond ETF | 2.72% | 2.73% | 6.96% | 4.28% | 1.17% | 1.75% | 2.71% | 2.07% | 1.48% | 0.34% | 1.67% | 1.15% |
DBC Invesco DB Commodity Index Tracking Fund | 4.60% | 4.94% | 0.59% | 0.00% | 0.00% | 1.59% | 1.30% | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Drawdowns
TIP vs. DBC - Drawdown Comparison
The maximum TIP drawdown since its inception was -14.56%, smaller than the maximum DBC drawdown of -76.36%. Use the drawdown chart below to compare losses from any high point for TIP and DBC. For additional features, visit the drawdowns tool.
Volatility
TIP vs. DBC - Volatility Comparison
The current volatility for iShares TIPS Bond ETF (TIP) is 1.58%, while Invesco DB Commodity Index Tracking Fund (DBC) has a volatility of 2.76%. This indicates that TIP experiences smaller price fluctuations and is considered to be less risky than DBC based on this measure. The chart below showcases a comparison of their rolling one-month volatility.