IEF vs LQD: Correlation
Measured on weekly returns over the past three years, iShares 7-10 Year Treasury Bond ETF (IEF) and iShares iBoxx Investment Grade Corporate Bond ETF (LQD) carry a correlation of 0.92, a very strong link.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are IEF and LQD?
On 3 years of weekly data the IEF/LQD correlation comes out at 0.92, very strong, meaning they move nearly in lockstep. The relationship has been stable: the 1-year correlation (0.88) sits close to the 3-year figure. The 5-year figure is 0.88, and annualized covariance runs at 43.4 %².
By 3-year correlation, LQD places #4 of the 48 assets tracked against IEF. Neither side won the trailing year by much: +0.9% against +1.5%. Stability stands out here, with the rolling one-year correlation confined to 0.81 through 0.95.
How is this computed?
Pearson correlation on weekly returns: ρ(A,B) = cov(rA, rB) / (σA · σB), over windows of 52, 156 and 260 weeks. Covariance is annualized (×52) and expressed in %². Full definitions on the methodology page.
IEF vs LQD: side by side
| IEF (iShares 7-10 Year Treasury Bond ETF) | LQD (iShares iBoxx Investment Grade Corporate Bond ETF) | |
|---|---|---|
| 1-year return | +0.9% | +1.5% |
| 5-year return | -7.9% | -4.1% |
| Volatility (ann.) | 6.5% | 7.3% |
| Beta vs S&P 500 | 0.04 | 0.15 |
| Max drawdown (3Y) | -6.9% | -6.7% |
| Dividend yield | 3.96% | 4.66% |
| Expense ratio | 0.15% | 0.14% |
| Assets under management | $47.2B | $33.0B |
| Sector / category | ETF · Bonds | ETF · Bonds |
IEF is a Long Government fund from iShares: $47.2B under management, a 0.15% expense ratio, a 3.96% trailing dividend yield. LQD, iShares's Corporate Bond fund, carries $33.0B under management, a 0.14% expense ratio, a 4.66% trailing dividend yield.
Year-by-year returns
| Year | IEF | LQD |
|---|---|---|
| 2022 | -15.2% | -17.9% |
| 2023 | +3.6% | +9.4% |
| 2024 | -0.6% | +0.9% |
| 2025 | +8.0% | +7.9% |
| 2026 | -0.8% | -0.5% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are IEF and LQD good diversifiers for each other?
Not really. At 0.92, the two trade almost as one position, and owning both buys little extra protection.
FAQ
What is the correlation between IEF and LQD?
As of 2026-08-27, the correlation of weekly returns between IEF and LQD is 0.92 over 3 years, 0.88 over 1 year and 0.88 over 5 years.
Is LQD a good diversifier for IEF?
Not really. At 0.92, the two trade almost as one position, and owning both buys little extra protection.
What does a correlation of 0.92 mean?
A reading of 0.92 sits on a scale from −1 (opposite moves) through 0 (unrelated) to +1 (identical moves). Correlation captures direction, not magnitude or performance.
Use this data
$ curl https://www.pairbook.io/api/v1/pairs/ief-vs-lqd.json
Embed this badge (it refreshes with the data), with attribution:
[](https://www.pairbook.io/pair/ief-vs-lqd/)
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Related comparisons
Hubs: IEF correlations · LQD correlations
