LQD vs USO: Correlation
iShares iBoxx Investment Grade Corporate Bond ETF (LQD) and United States Oil Fund (USO) show a negative relationship: their 3-year correlation of weekly returns is -0.24.
Data as of 2026-08-27 · refreshed every trading day · weekly returns · methodology
How correlated are LQD and USO?
Over the past 3 years, LQD and USO moved with a correlation of -0.24, which is negative, meaning they tend to move in opposite directions. The link has loosened recently: the 1-year correlation (-0.44) runs below the 3-year figure (-0.24). Over 5 years the correlation is -0.15, and the annualized covariance of weekly returns is -67.7 %².
USO is close to the least connected end of LQD's tracked universe, ranking #31 of 33. Correlation aside, the last 12 months split them widely, with USO ahead by 72.6 points (+1.5% versus +74.1%). On a rolling one-year basis the correlation drifted between -0.42 and 0.06, a moderate band. Note the risk asymmetry: USO runs 5.4 times the annualized volatility of the other leg, so equal-weighting the two is not an equal-risk position.
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.
LQD vs USO: side by side
| LQD (iShares iBoxx Investment Grade Corporate Bond ETF) | USO (United States Oil Fund) | |
|---|---|---|
| 1-year return | +1.5% | +74.1% |
| 5-year return | -4.1% | +168.6% |
| Volatility (ann.) | 7.3% | 39.4% |
| Beta vs S&P 500 | 0.15 | -0.20 |
| Max drawdown (3Y) | -6.7% | -32.5% |
| Dividend yield | 4.66% | – |
| Expense ratio | 0.14% | – |
| Assets under management | $33.0B | – |
| Sector / category | ETF · Bonds | ETF · Commodities |
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 | LQD | USO |
|---|---|---|
| 2022 | -17.9% | +29.0% |
| 2023 | +9.4% | -4.9% |
| 2024 | +0.9% | +13.4% |
| 2025 | +7.9% | -8.5% |
| 2026 | -0.5% | +88.0% |
Calendar-year price returns; the current year is year-to-date as of the data date above.
Are LQD and USO good diversifiers for each other?
Yes. With a correlation of -0.24, LQD and USO have moved largely independently, which makes them a genuinely diversifying pair by historical standards.
FAQ
What is the correlation between LQD and USO?
As of 2026-08-27, the correlation of weekly returns between LQD and USO is -0.24 over 3 years, -0.44 over 1 year and -0.15 over 5 years.
Is USO a good diversifier for LQD?
Yes. With a correlation of -0.24, LQD and USO have moved largely independently, which makes them a genuinely diversifying pair by historical standards.
What does a correlation of -0.24 mean?
A reading of -0.24 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/lqd-vs-uso.json
Drop this badge in a README or notebook; it updates with the data:
[](https://www.pairbook.io/pair/lqd-vs-uso/)
No key needed, free to use. Full endpoint list in the API documentation.
Related comparisons
Hubs: LQD correlations · USO correlations
