Cory Renauer, The Motley Fool
4 min read
The iShares 5-10 Year Investment Grade Corporate Bond ETF (NASDAQ:IGIB) stands out for its lower cost and higher yield, while the iShares 3-7 Year Treasury Bond ETF (NASDAQ:IEI) offers lower volatility and a more conservative Treasury-only approach.
Both IGIB and IEI are popular bond ETFs from iShares, but they serve different roles. IGIB focuses on intermediate-term investment-grade corporate bonds, while IEI targets U.S. Treasuries with slightly shorter maturities. This comparison highlights the key differences in cost, risk, and portfolio construction for investors considering these two fixed income funds.
|
Metric |
IGIB |
IEI |
|---|---|---|
|
Issuer |
IShares |
IShares |
|
Expense ratio |
0.04% |
0.15% |
|
1-yr return (as of 2026-04-10) |
9.12% |
4.41% |
|
Dividend yield |
4.7% |
3.6% |
|
AUM |
$17.7 billion |
$18.8 billion |
The 1-yr return represents total return over the trailing 12 months.
IEI comes with a notably higher expense ratio, costing nearly four times as much as IGIB. IGIB not only looks more affordable, but it also delivers a higher dividend yield, which may appeal to income-focused investors.
|
Metric |
IGIB |
IEI |
|---|---|---|
|
Max drawdown (5 y) |
(20.62%) |
(13.88%) |
|
Growth of $1,000 over 5 years |
$1,086 |
$1,025 |
IEI holds a concentrated portfolio of just eighty-three U.S. Treasury bonds with maturities between three and seven years, making it a pure-play on government debt. The fund has existed for over nineteen years, and its largest positions are Treasury notes maturing in 2029, 2030, and 2031. This simplicity could suit investors who want maximum credit safety and direct interest rate exposure without corporate risk.
IGIB, by contrast, invests in nearly 3,000 investment-grade corporate bonds, offering broad exposure to major U.S. companies and financial institutions. Its largest corporate bond holdings each make up less than a quarter of a percent of the overall fund. IGIB’s corporate tilt brings higher yield and credit risk, but also greater diversification across issuers.
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The iShares 5-10 Year Investment Grade Corporate Bond ETF gives investors a lot of diversification among bond issuers. The largest bond issue it holds makes up about 0.25% of the portfolio. Plus, the top issuer, JPMorgan Chase (NYSE:JPM) is responsible for just 2.3% of overall portfolio.
The iShares 3-7 Year Treasury Bond ETF doesn’t offer investors any diversification. It’s entirely invested in U.S. Treasureies that expire between 2029 and 2033.
Investors seeking stability that comes with treasuries backed by the government haven’t given up much when it comes to returns provided by these two ETF. Over the past five years the iShares 5-10 Year Investment Grade Corporate Bond ETF produced a total return of just 8.37%, which isn’t anything to write home about.
