IBDS vs QQQ
iShares iBonds Dec 2027 Term Corporate ETF vs Invesco QQQ Trust, Series 1
Quick Verdict
IBDS has a lower expense ratio. QQQ delivered stronger 1-year returns. IBDS offers more diversification with 663 holdings.
Side-by-Side Comparison
| Metric | IBDS | QQQ | Winner |
|---|---|---|---|
| Expense Ratio | 0.10% | 0.18% | |
| AUM | $3.9B | $496.3B | |
| Dividend Yield | 4.30% | 0.44% | |
| Holdings | 663 | 108 | |
| YTD Return | +2.11% | +16.64% | |
| 1Y Return | +4.20% | +27.27% | |
| 3Y Return (annualized) | +5.75% | +25.96% | |
| 5Y Return (annualized) | +1.41% | +14.54% | |
| Volatility (annualized) | 5.6% | 30.6% | |
| Max Drawdown | -16.8% | -83.0% | |
| Fund Family | iShares by BlackRock (US) | Invesco (US) | |
| Category | Fixed Income | Equity | |
| Inception | Sep 12, 2017 | Mar 10, 1999 |
IBDS vs QQQ Performance
iShares iBonds Dec 2027 Term Corporate ETF (IBDS) is a ETF from iShares by BlackRock (US) and Invesco QQQ Trust, Series 1 (QQQ) is a ETF from Invesco (US). Over the past year IBDS returned +4.20% while QQQ returned +27.27%. Year to date, IBDS is up 2.11% versus a gain of 16.64% for QQQ.
Over three years, IBDS compounded at +5.75% per year against +25.96% for QQQ; over five years the annualized figures are +1.41% and +14.54% respectively. Across the full 9-year window we track, QQQ has the edge at +13.03% annualized vs +1.90%. Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
QQQ has been the more volatile fund, with annualized monthly volatility of 30.6% compared with 5.6% for IBDS. Lower volatility generally means a smoother ride, though it often comes with lower long-run returns.
The deepest peak-to-trough decline in our data was -16.8% for IBDS and -83.0% for QQQ. Drawdown depth is worth weighing if you expect to sell during market stress rather than ride it out.
The two funds' monthly returns correlate at 0.52. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
IBDS charges 0.10% per year while QQQ charges 0.18%. On a $10,000 position that is $10 vs $18 annually, a gap of $8 per year that compounds over a long holding period. On income, IBDS currently yields 4.30% against 0.44% for QQQ.
Holdings Overlap
IBDS and QQQ share 0 holdings out of 703 unique holdings combined, representing a 0.0% weight overlap.
Moderate overlap means holding both could provide meaningful diversification benefits.
Frequently Asked Questions
Which is cheaper, IBDS or QQQ?
IBDS has an expense ratio of 0.10% while QQQ charges 0.18%. IBDS is the cheaper option. On a $10,000 investment, that is $8 per year of difference.
Which performed better, IBDS or QQQ?
Over the past year IBDS returned +4.20% vs +27.27% for QQQ, so QQQ leads on 1-year performance. Over the longest common window we track (9 years), IBDS annualized +1.90% vs +13.03% for QQQ. Past performance does not guarantee future results.
Which is riskier, IBDS or QQQ?
QQQ has been the more volatile fund at 30.6% annualized versus 5.6% for IBDS. Worst drawdown: IBDS -16.8% vs QQQ -83.0%.
Should I hold both IBDS and QQQ?
IBDS and QQQ have a monthly-return correlation of 0.52, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between IBDS and QQQ?
IBDS and QQQ share 0 common holdings with a 0.0% weight overlap. Combined, they hold 703 unique securities.
Which pays a higher dividend, IBDS or QQQ?
IBDS yields 4.30% while QQQ yields 0.44%, so IBDS currently pays the higher dividend yield.
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