LQDW vs VYM
iShares Investment Grade Corporate Bond BuyWrite Strategy ETF vs Vanguard High Dividend Yield ETF
Quick Verdict
VYM has a lower expense ratio. VYM delivered stronger 1-year returns. LQDW offers more diversification with 3,135 holdings.
Side-by-Side Comparison
| Metric | LQDW | VYM | Winner |
|---|---|---|---|
| Expense Ratio | 0.34% | 0.04% | |
| AUM | $319M | $81.6B | |
| Dividend Yield | 12.32% | 2.24% | |
| Holdings | 3,135 | 616 | |
| YTD Return | -5.01% | +14.66% | |
| 1Y Return | -3.44% | +22.16% | |
| 3Y Return (annualized) | +1.80% | +18.72% | |
| 5Y Return (annualized) | - | +12.18% | |
| Volatility (annualized) | 5.9% | 14.6% | |
| Max Drawdown | -9.2% | -58.8% | |
| Fund Family | iShares by BlackRock (US) | Vanguard (US) | |
| Category | Fixed Income | Equity | |
| Inception | Aug 18, 2022 | Nov 10, 2006 |
LQDW vs VYM Performance
iShares Investment Grade Corporate Bond BuyWrite Strategy ETF (LQDW) is a ETF from iShares by BlackRock (US) and Vanguard High Dividend Yield ETF (VYM) is a ETF from Vanguard (US). Over the past year LQDW returned -3.44% while VYM returned +22.16%. Year to date, LQDW is down 5.01% versus a gain of 14.66% for VYM.
Over three years, LQDW compounded at +1.80% per year against +18.72% for VYM. Across the full 4-year window we track, VYM has the edge at +7.01% annualized vs +0.50%. 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 5.9% for LQDW. 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 -9.2% for LQDW and -58.8% for VYM. 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 0.53. They move independently enough that combining them can meaningfully diversify a portfolio.
Fees and Cost Over Time
LQDW charges 0.34% per year while VYM charges 0.04%. On a $10,000 position that is $34 vs $4 annually, a gap of $30 per year that compounds over a long holding period. On income, LQDW currently yields 12.32% against 2.24% for VYM.
Holdings Overlap
LQDW and VYM share 0 holdings out of 622 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, LQDW or VYM?
LQDW has an expense ratio of 0.34% while VYM charges 0.04%. VYM is the cheaper option. On a $10,000 investment, that is $30 per year of difference.
Which performed better, LQDW or VYM?
Over the past year LQDW returned -3.44% vs +22.16% for VYM, so VYM leads on 1-year performance. Over the longest common window we track (4 years), LQDW annualized +0.50% vs +7.01% for VYM. Past performance does not guarantee future results.
Which is riskier, LQDW or VYM?
VYM has been the more volatile fund at 14.6% annualized versus 5.9% for LQDW. Worst drawdown: LQDW -9.2% vs VYM -58.8%.
Should I hold both LQDW and VYM?
LQDW and VYM have a monthly-return correlation of 0.53, so combining them can provide real diversification depending on your allocation goals.
What is the holdings overlap between LQDW and VYM?
LQDW and VYM share 0 common holdings with a 0.0% weight overlap. Combined, they hold 622 unique securities.
Which pays a higher dividend, LQDW or VYM?
LQDW yields 12.32% while VYM yields 2.24%, so LQDW currently pays the higher dividend yield.
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