The iShares 1-5 Year Investment Grade Corporate Bond ETF (IGSB) and the JPMorgan Ultra-Short Income ETF (JPST) are both among the Top 100 ETFs. IGSB is a iShares Short-Term Bond fund and JPST is a JPMorgan Ultrashort Bond fund. So, what’s the difference between IGSB and JPST? And which fund is better?
The expense ratio of IGSB is 0.12 percentage points lower than JPST’s (0.06% vs. 0.18%). IGSB is mostly comprised of BBB bonds and JPST has a high exposure to A bond. Overall, IGSB has provided lower returns than JPST over the past 3 years.
In this article, we’ll compare IGSB vs. JPST. We’ll look at risk metrics and performance, as well as at their portfolio growth and fund composition. Moreover, I’ll also discuss IGSB’s and JPST’s holdings, annual returns, and industry exposure and examine how these affect their overall returns.
Summary
| IGSB | JPST | |
| Name | iShares 1-5 Year Investment Grade Corporate Bond ETF | JPMorgan Ultra-Short Income ETF |
| Category | Short-Term Bond | Ultrashort Bond |
| Issuer | iShares | JPMorgan |
| AUM | 26.63B | 17.32B |
| Avg. Return | 2.51% | 2.57% |
| Div. Yield | 2.02% | 0.94% |
| Expense Ratio | 0.06% | 0.18% |
The iShares 1-5 Year Investment Grade Corporate Bond ETF (IGSB) is a Short-Term Bond fund that is issued by iShares. It currently has 26.63B total assets under management and has yielded an average annual return of 2.51% over the past 10 years. The fund has a dividend yield of 2.02% with an expense ratio of 0.06%.
The JPMorgan Ultra-Short Income ETF (JPST) is a Ultrashort Bond fund that is issued by JPMorgan. It currently has 17.32B total assets under management and has yielded an average annual return of 2.57% over the past 10 years. The fund has a dividend yield of 0.94% with an expense ratio of 0.18%.
IGSB’s dividend yield is 1.08% higher than that of JPST (2.02% vs. 0.94%). Also, IGSB yielded on average 0.07% less per year over the past decade (2.51% vs. 2.57%). The expense ratio of IGSB is 0.12 percentage points lower than JPST’s (0.06% vs. 0.18%).
Fund Composition
Holdings
| IGSB Bond Sectors | Weight |
| BBB | 50.48% |
| A | 40.04% |
| AA | 7.46% |
| AAA | 2.21% |
| BB | 0.09% |
| Below B | 0.0% |
| B | 0.0% |
| US Government | 0.0% |
| Others | -0.28% |
IGSB’s Top Bond Sectors are ratings of BBB, A, AA, AAA, and BB at 50.48%, 40.04%, 7.46%, 2.21%, and 0.09%. The fund is less weighted towards Below B (0.0%), B (0.0%), and US Government (0.0%) rated bonds.
| JPST Bond Sectors | Weight |
| A | 39.21% |
| BBB | 36.75% |
| AAA | 14.9% |
| AA | 9.14% |
| Others | 0.0% |
| Below B | 0.0% |
| B | 0.0% |
| BB | 0.0% |
| US Government | 0.0% |
JPST’s Top Bond Sectors are ratings of A, BBB, AAA, AA, and Others at 39.21%, 36.75%, 14.9%, 9.14%, and 0.0%. The fund is less weighted towards Below B (0.0%), B (0.0%), and BB (0.0%) rated bonds.
Risk Analysis
| IGSB | JPST | |
| Mean Return | 0.19 | 0 |
| R-squared | 26.13 | 0 |
| Std. Deviation | 2 | 0 |
| Alpha | 0.69 | 0 |
| Beta | 0.34 | 0 |
| Sharpe Ratio | 0.82 | 0 |
| Treynor Ratio | 4.82 | 0 |
The iShares 1-5 Year Investment Grade Corporate Bond ETF (IGSB) has a Mean Return of 0.19 with a Alpha of 0.69 and a Treynor Ratio of 4.82. Its Standard Deviation is 2 while IGSB’s Sharpe Ratio is 0.82. Furthermore, the fund has a Beta of 0.34 and a R-squared of 26.13.
The JPMorgan Ultra-Short Income ETF (JPST) has a Mean Return of 0 with a R-squared of 0 and a Treynor Ratio of 0. Its Sharpe Ratio is 0 while JPST’s Standard Deviation is 0. Furthermore, the fund has a Beta of 0 and a Alpha of 0.
IGSB’s Mean Return is 0.19 points higher than that of JPST and its R-squared is 26.13 points higher. With a Standard Deviation of 2, IGSB is slightly more volatile than JPST. The Alpha and Beta of IGSB are 0.69 points higher and 0.34 points higher than JPST’s Alpha and Beta.
Performance
Annual Returns
| Year | IGSB | JPST |
| 2020 | 5.26% | 2.17% |
| 2019 | 7.01% | 3.36% |
| 2018 | 1.34% | 2.19% |
| 2017 | 1.41% | 0.0% |
| 2016 | 1.77% | 0.0% |
| 2015 | 0.7% | 0.0% |
| 2014 | 0.74% | 0.0% |
| 2013 | 1.03% | 0.0% |
| 2012 | 3.28% | 0.0% |
| 2011 | 1.34% | 0.0% |
| 2010 | 3.69% | 0.0% |
IGSB had its best year in 2019 with an annual return of 7.01%. IGSB’s worst year over the past decade yielded 0.7% and occurred in 2015. In most years the iShares 1-5 Year Investment Grade Corporate Bond ETF provided moderate returns such as in 2011, 2017, and 2016 where annual returns amounted to 1.34%, 1.41%, and 1.77% respectively.
The year 2019 was the strongest year for JPST, returning 3.36% on an annual basis. The poorest year for JPST in the last ten years was 2017, with a yield of 0.0%. Most years the JPMorgan Ultra-Short Income ETF has given investors modest returns, such as in 2013, 2012, and 2011, when gains were 0.0%, 0.0%, and 0.0% respectively.
Portfolio Growth
| Fund | Initial Balance | Final Balance | CAGR |
| IGSB | $10,000 | $11,414 | 2.51% |
| JPST | $10,000 | $10,791 | 2.57% |
A $10,000 investment in IGSB would have resulted in a final balance of $11,414. This is a profit of $1,414 over 3 years and amounts to a compound annual growth rate (CAGR) of 2.51%.
With a $10,000 investment in JPST, the end total would have been $10,791. This equates to a $791 profit over 3 years and a compound annual growth rate (CAGR) of 2.57%.
IGSB’s CAGR is 0.07 percentage points lower than that of JPST and as a result, would have yielded $623 more on a $10,000 investment. Thus, IGSB performed worse than JPST by 0.07% annually.
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