IBND vs USIG

IBNDDSPDR Bloomberg International Corporate Bond ETF

USIGAiShares Broad USD Investment Grade Corporate Bond ETF

In short

IBND Nearly every investment-grade corporate bond ETF buys dollar debt. IBND buys the rest of the world: roughly 900 corporate bonds issued outside the US, in euros, yen and sterling, with the currency exposure left in.

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

IBND The fund seeks investment results corresponding generally to the Bloomberg Global Aggregate ex-USD > $1B: Corporate Bond Index, providing broad exposure to global investment-grade, fixed-rate corporate bonds outside the United States.

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

Why people hold it

• IBND A passport out of dollar credit: broad investment-grade corporate exposure from issuers outside the US, roughly 900 bonds, in one ticker.ssga.com
• Different central banks, different rate cycles, different currencies from a US bond sleeve. That is the whole reason this thing exists.ssga.com
• Listed since 2010, pays income monthly, and trades actively enough for everyday retail orders.

• 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

• IBND 0.50% a year is well above the roughly 0.19% typical for investment-grade corporate funds, and dollar-credit peers like VCIT and SPIB charge 0.03% to 0.04%.
• Currency is the loud part. The bonds are non-dollar, so exchange rate moves can swamp the coupons in either direction when results are converted back to dollars.ssga.com
• Against the wider investment-grade corporate group it lands in the back quarter, mostly on fee and price-swing measures rather than how it tracks its index.

• 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 IBND profile⁠

Full USIG profile⁠