FIGB vs USIG

FIGBCFidelity Investment Grade Bond ETF

USIGAiShares Broad USD Investment Grade Corporate Bond ETF

In short

FIGB The name says investment grade, but Fidelity's managers can also reach into high yield and emerging-market debt while keeping interest-rate risk near the Agg. A credit-picking fund wearing a core-bond duration profile.

USIG Most investment-grade corporate bond funds hand you one slice of the maturity curve. USIG takes the whole thing, thousands of US dollar corporate bonds from short-dated to long, for four basis points a year.

Stated mandate

FIGB The fund seeks a high level of current income by investing primarily in debt securities across investment-grade, high-yield, and emerging-market segments, while maintaining interest-rate risk similar to the Bloomberg U.S. Aggregate Bond Index.

USIG The fund seeks to track an index of U.S. dollar-denominated investment-grade corporate bonds.

Why people hold it

• FIGB Active by design: the managers hunt income across investment-grade, high-yield and emerging-market debt while holding interest-rate risk similar to the Bloomberg U.S. Aggregate.
• A 0.36% expense ratio sits right at the median of its core-bond peer group, which is uncommon for a live manager competing against index trackers.
• Income is paid monthly, and the book is a focused roughly 180 positions rather than a thousands-strong index sleeve.
• The portfolio has stayed closely aligned with what its documents promise, and it lands in the upper half of its core-bond peer group.

• USIG Costs 0.04% a year, against a category median near 0.19%. CORP, which tracks the same ICE BofA US Corporate Index, charges 0.41%.
• One ticker, the full USD investment-grade corporate curve: thousands of bonds, short to long. Slice funds like IGSB (1-5 year) and IGIB (5-10 year) each cover one segment.ishares.com
• Running since 2007, it has tracked its index with very little drift and is one of the more actively traded funds in its category.
• Interest lands monthly, and this is a multi-billion-dollar fund that ranks among the strongest implementations in its peer group.

Worth knowing

• FIGB Index Aggs like BND and SPAB charge 0.03%. At 0.36%, you are paying roughly twelve times as much for the active credit calls.
• The high-yield and emerging-market sleeves carry credit risk a plain investment-grade index tracker would not take on.
• Moderately traded and mid-sized next to the giant index Aggs, so spreads can run wider, which shows up most on large or hurried orders.

• USIG Owning the whole curve means long-dated bonds ride along, so the price swings more when rates move than a short-maturity slice such as IGSB.
• This is corporate credit, not Treasuries. Investment grade at purchase, but prices can fall when spreads widen or an issuer is downgraded.ishares.com
• VCIT edges it on fee at 0.03%, though that fund stays in intermediate maturities rather than the full curve.

Full FIGB profile⁠

Full USIG profile⁠