4 min read
By Ron Koren, ETF Insider


Exchange-Traded Funds (ETFs) have become increasingly popular among investors, offering diversified exposure to various asset classes and sectors. In this article, we will conduct a thorough comparison between two prominent ETFs: TIP (iShares TIPS Bond ETF) and LQD (iShares iBoxx $ Investment Grade Corporate Bond ETF). We will delve into various aspects of these ETFs, including their tickers, full names, issuers, sectors, top holdings, capitalization, strategy, tracking, and exposure.

TIP VS LQD: Overview

TIP and LQD are two ETFs that cater to different segments of the fixed-income market. TIP focuses on Treasury Inflation-Protected Securities (TIPS), which are designed to protect investors from inflation. On the other hand, LQD invests in investment-grade corporate bonds, offering a different avenue for fixed-income investors. Understanding the fundamental differences between these ETFs is crucial for making informed investment decisions.

TIP VS LQD: Sectors and Top Holdings

TIP primarily invests in U.S. government bonds linked to inflation, providing investors with a hedge against rising prices. The ETF's top holdings typically consist of various TIPS with varying maturities. In contrast, LQD's holdings are in high-quality corporate bonds issued by companies like Apple, Microsoft, and Johnson & Johnson. Analyzing the sectors and top holdings can help investors gauge the risk-reward profile of these ETFs.

TIP overlap TIP VS LQDTIP overlap TIP VS LQD

TIP VS LQD: Capitalization and Strategy

TIP boasts a substantial asset under management (AUM), reflecting its popularity among investors seeking protection against inflation. The ETF's strategy revolves around tracking the performance of TIPS, which tend to move in tandem with changes in inflation rates. LQD, with its focus on investment-grade corporate bonds, offers a different risk-return profile. It's essential for investors to consider the capitalization and strategy of these ETFs when constructing their fixed-income portfolios.

TIP VS LQD: Tracking and Exposure

TIP aims to provide investors with exposure to the movements of inflation by holding a diversified basket of TIPS. Its tracking method involves closely following the inflation-adjusted returns of these securities. On the other hand, LQD tracks an index of investment-grade corporate bonds, seeking to mirror the performance of this specific segment of the bond market. Understanding these tracking and exposure strategies is vital for investors looking to align their fixed-income investments with their financial goals and risk tolerance.


TIP and LQD are distinct ETFs, each offering a unique approach to fixed-income investing. Whether you're interested in protecting your investments from inflation or seeking stable returns from investment-grade corporate bonds, these ETFs can play a crucial role in your portfolio. However, it's important to conduct thorough research and consider your individual investment objectives before making any decisions. For those looking to explore these and other financial instruments in greater detail, ETF Insider is the ultimate tool to check holdings, correlations, overlaps, and gain valuable insights. With its user-friendly app, it provides comprehensive information on a wide range of ETFs and financial assets.

Disclaimer: This article does not provide any investment advisory services. Always consult with a qualified financial advisor before making investment decisions.

TIP ETF issuer
TIP ETF official page

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