What is the expense ratio of BND vs LQD?

BND has an expense ratio of 0.03%, while LQD has an expense ratio of 0.14%.

BND vs LQD

Vanguard Total Bond Market Index Fund vs iShares iBoxx $ Investment Grade Corporate Bond ETF

Last updated: 2026-04-10

BND Vanguard

Vanguard Total Bond Market Index Fund (BND) is an exchange-traded fund issued by Vanguard that provides exposure to the broad U.S. investment-grade bond market. It charges a very low expense ratio of 0.03%. The fund offers an attractive dividend yield of 3.92%. Launched in 2007, the fund has a 19-year track record.

AUM: $152.0B ER: 0.03% Yield: 3.92% Since: Apr 3, 2007

LQD iShares

iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) is an exchange-traded fund issued by iShares that provides exposure to investment-grade U.S. corporate bonds. It charges a low expense ratio of 0.14%. The fund offers a high dividend yield of 4.53%. Launched in 2002, the fund has a 24-year track record.

AUM: $30.8B ER: 0.14% Yield: 4.53% Since: Jul 22, 2002

Quick Verdict

BND is significantly cheaper at 0.03% vs 0.14% expense ratio, saving you approximately $218 per $10,000 invested over 10 years. LQD has edged ahead over the past year (3.9% vs 2.2%). Income investors may prefer LQD for its higher yield (4.5% vs 3.9%).

Key Metrics

Metric	BND	LQD
Expense Ratio	0.03%	0.14%
Dividend Yield	3.9%	4.5%
Fund Family	Vanguard	iShares
Category	US Aggregate Bond	US Investment Grade Corporate

Performance Chart

Indexed to 100 at start (5-year comparison)

BND -13.3%

LQD -16.4%

Performance Comparison

Period	BND	LQD	Difference
1 Month	-0.29%	+0.17%	-0.46%
3 Months	-0.73%	-1.05%	+0.32%
6 Months	-1.29%	-2.13%	+0.84%
YTD	-0.49%	-0.74%	+0.25%
1 Year	+2.18%	+3.89%	-1.71%
3 Years	-0.40%	-0.41%	+0.01%
5 Years	-13.25%	-16.38%	+3.13%

Fee Impact Over Time

Estimated fee cost difference assuming 8% annual returns

Investment	Period	BND Fees	LQD Fees	You Save
$10,000	10 years	$60	$278	$218
$10,000	20 years	$258	$1,194	$935
$10,000	30 years	$835	$3,841	$3,005
$50,000	10 years	$299	$1,391	$1,092
$50,000	30 years	$4,176	$19,203	$15,027
$100,000	30 years	$8,352	$38,406	$30,054

Risk Metrics

Based on 5 years of daily returns

Metric	BND	LQD
Annualized Volatility	6.0%	8.7%
Max Drawdown	-21.7%	-27.9%
Sharpe Ratio	-1.19	-0.89

Dividend Comparison

Metric	BND	LQD
Annual Dividend (per share)	$2.89	$4.95
Dividend Yield	3.92%	4.53%
Distribution Frequency	Monthly	Monthly

Which One Should You Choose?

Choose BND if...

you want the lowest fees and plan to buy and hold long-term. Over decades, the expense ratio difference compounds significantly.

Choose LQD if...

you prioritize dividend income and want higher regular distributions from your portfolio.

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