LQD vs VYM
iShares iBoxx $ Investment Grade Corporate Bond ETF vs Vanguard High Dividend Yield ETF
Which is better, LQD or VYM?
Long Term Mid Quality against Large Cap Value.
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window.
MarketXLS is not an investment adviser. This comparison is generated automatically from market data and is for information only. A Best mark means the better reading on that one measure, not a recommendation to buy.
Side-by-Side Comparison
| Metric | LQD | VYM |
|---|---|---|
| Expense Ratio | 0.14% | 0.04%Best |
| AUM | $32.0B | $81.6B |
| Dividend Yield | 4.67% | 2.22% |
| Holdings | 3,134 | 613 |
| YTD Return | -2.20% | +11.71%Best |
| 1Y Return | -2.59% | +16.24%Best |
| 3Y Return (annualized) | +4.43% | +17.24%Best |
| 5Y Return (annualized) | -1.29% | +11.86%Best |
| Volatility (annualized) | 8.2%Best | 14.6% |
| Max Drawdown | -24.9%Best | -58.8% |
| $10,000 over 5 years | $9,371 | $17,514Best |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) |
| Category | Fixed Income | Equity |
| Style | Long Term Mid Quality | Large Cap Value |
| Inception | Jul 22, 2002 | Nov 10, 2006 |
Not shown on this pair: Top 10 Weight.
Volatility and max drawdown are measured over the window both funds cover: Nov 16, 2006 to Sep 16, 2026 (19.8 years).
LQD vs VYM growth
Month-end closes. Both lines start at 0% in the first month shown, so the gap between them is the difference in growth across that window. The full view covers the 19.8 years both funds cover.
LQD vs VYM Performance
iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is an ETF from iShares by BlackRock (US) and Vanguard High Dividend Yield ETF (VYM) is an ETF from Vanguard (US). Over the past year LQD returned -2.59% while VYM returned +16.24%. Year to date, LQD is down 2.20% versus a gain of 11.71% for VYM.
Over three years, LQD compounded at +4.43% per year against +17.24% for VYM; over five years the annualized figures are -1.29% and +11.86% respectively. Across the full 20-year window we track, VYM has the edge at +6.84% annualized vs +3.88%.
Past performance does not guarantee future results.
Risk: Volatility and Drawdowns
VYM has been the more volatile fund, with annualized monthly volatility of 14.6% compared with 8.2% for LQD. 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 -24.9% for LQD and -58.8% for VYM. Drawdown depth is what each fund did in the worst stretch of the window measured above.
The two funds' monthly returns correlate at 0.39. They move together some of the time, and apart the rest.
Fees and Cost Over Time
LQD charges 0.14% per year while VYM charges 0.04%. On a $10,000 position that is $14 vs $4 annually, a gap of $10 per year that compounds over a long holding period. On income, LQD currently yields 4.67% against 2.22% for VYM.
Holdings Overlap
At least 0.3% of VYM's money is in holdings LQD also owns.
Stated as a floor: for LQD, our book for it covers 42.7% of that fund, so a holding it does not list is one we cannot count as shared. The real figure is this or higher.
We cannot see either book well enough to say how much of this pair is duplicated.
1 positions in common, counted across the 1,060 positions we hold weights for in LQD and 557 in VYM, against full books of 3,134 and 613.
Top Shared Holdings
| Stock | Weight in LQD | Weight in VYM | Difference |
|---|---|---|---|
| TMUST-Mobile Usa Inc Esrw Usd Npv Ref Sm#585558 | 0.17% | 0.34% | 0.17% |
You are not choosing between two funds in isolation.
Whichever of LQD and VYM you pick has to sit alongside everything else you own. Add the rest and see what the combination actually holds.
Free for up to 10 holdings. No account needed.
Frequently Asked Questions
Which is cheaper, LQD or VYM?
LQD has an expense ratio of 0.14% while VYM charges 0.04%. VYM is the cheaper option, by $10 a year on a $10,000 investment.
Which performed better, LQD or VYM?
Over the past year LQD returned -2.59% vs +16.24% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (20 years), LQD annualized +3.88% vs +6.84% for VYM. Past performance does not guarantee future results. This is information, not a recommendation.
Which is riskier, LQD or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 8.2% for LQD. Worst drawdown: LQD -24.9% vs VYM -58.8%.
Should I hold both LQD and VYM?
LQD and VYM have a monthly-return correlation of 0.39, so their returns are far enough apart for the mix to behave differently from either one alone. This is information, not a recommendation.
Which pays a higher dividend, LQD or VYM?
LQD yields 4.67% while VYM yields 2.22%, so LQD currently pays the higher dividend yield.
Is VYM better than LQD?
VYM has a lower expense ratio. VYM led over 1Y, 3Y, 5Y and the full window. Which one suits a particular account depends on what it is for. This is information, not a recommendation.