HYG alternatives and similar ETFs

HYG alternatives at a glance#

Each fund below can stand in for HYG, closest first. “Same kind” funds hold the same kind of bonds through a different index. “Related” funds make a different bet that often moves the same way.

Fees come from each fund company, checked on the dates shown on each fund’s page.

How HYG and its alternatives did over the same dates#

Each row measures the alternative and HYG on the days both traded, so neither gets a head start. Correlation shows how closely their daily moves matched over about the last five years. A value of 1 means they always moved together.

Prices through October 16, 2026. Figures use daily closing prices adjusted for splits, with dividends reinvested. They do not include taxes or the cost of buying and selling. Past results do not tell you what will happen next.

Each HYG alternative, compared#

USHY: iShares Broad USD High Yield Corporate Bond ETF#

USHY also holds bonds from US companies with weaker credit, which pay more interest and carry more risk. It tracks the ICE BofA US High Yield Constrained Index, while HYG tracks the iBoxx USD Liquid High Yield Index.

It charges 0.08% a year, about $8 on $10,000, against $49 for HYG. It held 1,902 holdings, against 1,334 for HYG.

From October 2017 to October 2026, USHY returned about 4.4% a year and HYG returned about 3.9% a year. Over about the last five years they moved almost exactly together (correlation 0.99).

Read the USHY fund page for its returns by year and worst drop.

JNK: State Street SPDR Bloomberg High Yield Bond ETF#

JNK also holds bonds from US companies with weaker credit, which pay more interest and carry more risk. It tracks the Bloomberg High Yield Very Liquid Index, while HYG tracks the iBoxx USD Liquid High Yield Index.

It charges 0.4% a year, about $40 on $10,000, against $49 for HYG. It held 1,161 holdings, against 1,334 for HYG.

From December 2007 to October 2026, JNK returned about 4.8% a year and HYG returned about 4.8% a year. Over about the last five years they moved almost exactly together (correlation 0.99).

Read the JNK fund page for its returns by year and worst drop.

LQD: iShares iBoxx $ Investment Grade Corporate Bond ETF#

LQD is a looser match. It holds bonds from large US companies with strong credit ratings, while HYG holds bonds from US companies with weaker credit, which pay more interest and carry more risk.

It charges 0.14% a year, about $14 on $10,000, against $49 for HYG. It held 3,171 holdings, against 1,334 for HYG.

From April 2007 to October 2026, LQD returned about 3.9% a year and HYG returned about 4.8% a year. Over about the last five years they often moved together, but not always (correlation 0.71).

Read the LQD fund page for its returns by year and worst drop.

VCIT: Vanguard Intermediate-Term Corporate Bond ETF#

VCIT is a looser match. It holds bonds from large US companies with strong credit ratings, while HYG holds bonds from US companies with weaker credit, which pay more interest and carry more risk.

It charges 0.03% a year, about $3 on $10,000, against $49 for HYG. It held 2,342 holdings, against 1,334 for HYG.

From November 2009 to October 2026, VCIT returned about 4.0% a year and HYG returned about 5.3% a year. Over about the last five years they often moved together, but not always (correlation 0.70).

Read the VCIT fund page for its returns by year and worst drop.

HYG versions from other fund companies#

Some people keep all their funds with one company. Here is the closest fund to HYG from each other company on this page:

• SPDR (State Street): JNK, State Street SPDR Bloomberg High Yield Bond ETF (same kind of fund, 0.4% a year)
• Vanguard: VCIT, Vanguard Intermediate-Term Corporate Bond ETF (related fund, 0.03% a year)

Most brokers let you buy any ETF, whoever runs it. Mutual fund versions, such as a fund company’s index mutual fund, are not listed here.

How to choose between HYG and its alternatives#

• What it tracks. A fund on the same index holds the same bonds. A different index can mean different weights, more or fewer holdings, or a different mix.
• The fee. The difference is often small. On $10,000, HYG costs about $49 a year. VCIT costs about $3.
• History. An older fund has been through more bad markets, so you can see how far it fell.
• What you already own. Two funds that move together add little variety. A fund with a low correlation behaves more on its own.

Swapping HYG to harvest a tax loss#

Some investors sell a fund at a loss to lower their taxes, then buy a similar fund so they stay invested. This is called tax-loss harvesting.

The IRS wash sale rule blocks the loss if you buy a “substantially identical” security within 30 days before or after the sale. The IRS has not said exactly when two funds count. Funds on the same index are more likely to. Funds on a different index, such as USHY, JNK or LQD, are less likely to.

Ask a tax professional before you rely on this. Read the IRS rules in Publication 550.

Test HYG and its alternatives in a backtest#

Tactfolio is a platform where you build rules-based investing strategies, backtest them on decades of real prices, share them, and run them automatically in your own Alpaca account. Open the builder, add HYG and USHY, and see how each would have done on the same dates, or how a mix of both would have done.

The details#

Alternatives are picked from facts, not from returns. First come funds that track the same index as HYG. Then come funds that hold the same kind of bonds through another index. Last come funds from a close category that make a different bet. Leveraged funds are only listed as alternatives to other leveraged funds.

Within each group, the funds whose daily returns moved most like HYG over about the last five years come first. Returns and worst drops use Tactfolio’s stored daily prices, adjusted for splits, with dividends reinvested. Each alternative is measured with HYG only on days both traded. Read what a backtest simulates for more on these measures.