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Schwab Treasury ETF Underperforms SPDR Corporate Bond Fund over Five Years

By Markets Desk · 2026-09-19 · 2 min read
A stack of paper currency and a single gold coin resting on a wooden desk
Illustration: Tradingbird

The Schwab Long-Term U.S. Treasury ETF lost 30.9% of a $1,000 investment over five years, while the State Street SPDR Portfolio Long Term Corporate Bond ETF lost 17.0%. Corporate credit offered higher income but faced deeper drawdowns during the period.

The Schwab Long-Term U.S. Treasury ETF (SCHQ) delivered a total return of $691 on a $1,000 investment over the past five years. The State Street SPDR Portfolio Long Term Corporate Bond ETF (SPLB) returned $830 for the same initial amount. SPLB outperformed SCHQ by $139 per $1,000 invested.

SCHQ carries a 0.03% expense ratio, while SPLB charges 0.04%. The corporate bond fund pays a trailing-12-month dividend yield of 5.7%. The Treasury fund pays a 5.0% yield. SPLB holds 2,950 positions, whereas SCHQ holds 102 positions.

Corporate Credit Outperformed Government Debt

SPLB targets investment-grade corporate bonds with maturities exceeding 10 years. SCHQ holds U.S. Treasury securities, often with maturities over 20 years. The credit risk profile differs significantly between the two assets. Corporate issuers pay higher yields to compensate for default risk.

SPLB has an asset size of $1.2 billion. SCHQ manages $843.6 million in assets. The SPDR fund launched in 2009. The Schwab fund launched in 2019. Both funds provide exposure to long-dated fixed income markets.

Risk Metrics Show Higher Volatility for Corporates

SPLB recorded a maximum drawdown of -34.5% over five years. SCHQ recorded a maximum drawdown of -40.9% over the same period. The corporate fund experienced a shallower decline in value during peak stress. SCHQ is considered to have lower credit risk than SPLB.

SPLB has a beta of 0.63 relative to the S&P 500. SCHQ has a beta of 0.49. The lower beta indicates SCHQ is less volatile than the broader equity market. SPLB is more sensitive to market movements than SCHQ.

Yield Differentials Reflect Credit Risk Premium

Investors in SPLB receive an additional 0.7 percentage points in annual income compared to SCHQ. This premium compensates for the risk of corporate default. U.S. Treasuries are backed by the federal government. Corporate bonds rely on the issuer's ability to repay debt.

SCHQ paid $1.47 per share over the trailing 12 months. SPLB paid $1.20 per share over the trailing 12 months. The share price for SCHQ is $29.44. The share price for SPLB is $21.03. Data is current as of September 10, 2026. GN auto markets/bonds: corporate bonds notes that credit quality is the primary differentiator between these two long-duration bond funds.

Based on reporting by The Motley Fool, compiled by the Tradingbird desk.

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