Quick Verdict
- Our Rating: ★★★★☆ (4 out of 5)
- Best For: Investors who want liquid, credit-risk-free U.S. Treasury exposure focused on the 7–10 year part of the yield curve
- Not Ideal For: Fee-sensitive buyers, investors who need principal stability over a short horizon, and those seeking inflation protection
- Expense Ratio: 0.15%
- Our Take: IEF delivers pure, highly liquid exposure to 7–10 year Treasuries, but it has posted negative 1-year and 5-year returns and charges more than several close competitors. It suits investors who value the specific maturity band and the fund’s long track record.
Table of Contents
What Is the iShares 7-10 Year Treasury Bond ETF (IEF)?
If you are asking “what is IEF ETF,” it is an exchange-traded fund from BlackRock’s iShares that holds U.S. Treasury notes with remaining maturities between seven and ten years. The fund tracks the ICE U.S. Treasury 7-10 Year Bond Index, a market-value-weighted benchmark, and it is structured as an open-end fund. It launched on July 22, 2002, which gives it more than two decades of history.
Because the fund holds only Treasuries, it carries no meaningful credit risk, and its average credit quality is AA. Its main risk is interest-rate sensitivity: with an average duration of 6.8 years, its price tends to move noticeably when Treasury yields change. The fund pays income monthly. Investors often use IEF as the middle layer of a bond allocation, sitting between short-term Treasuries and long-term funds such as TLT.
IEF ETF Key Facts
| Item | Detail |
|---|---|
| Full name | iShares 7-10 Year Treasury Bond ETF |
| Ticker | IEF |
| Issuer | BlackRock / iShares |
| Benchmark index | ICE U.S. Treasury 7-10 Year Bond Index |
| Inception date | July 22, 2002 |
| Expense ratio | 0.15% |
| AUM | $42.0 billion |
| Average volume | ~12.6 million shares/day |
| Dividend yield | 4.07% (12-month trailing) |
| SEC yield | 4.99% (30-day, as of Oct 22, 2026) |
| Dividend frequency | Monthly |
| Structure | Open-end fund |
| Number of holdings | 17 |
| Average duration | 6.8 years |
IEF ETF Performance
IEF has had a difficult stretch. Over the past year, the fund returned -3.73%, as rising yields pushed Treasury prices lower. Over three years, it posted an annualized gain of +2.91%. The five-year annualized return was -2.05%, and the ten-year annualized return was +0.10%, which means long-term holders earned little more than the fund’s income after accounting for price declines.
Against its benchmark, the ICE U.S. Treasury 7-10 Year Bond Index, the fund tracked closely. The index returned -3.7% over one year, +2.9% over three years, -2.1% over five years and +0.1% over ten years. Differences between the fund and the index were 0.05 percentage points or less on every horizon, which falls within the rounding of the published benchmark figures, so no meaningful tracking error appeared in this data.
The gap between the 4.07% trailing dividend yield and the 4.99% SEC yield reflects different methods: the trailing figure looks at distributions already paid, while the SEC yield annualizes recent income net of expenses. Past performance is not a guarantee of future results, and bond fund returns depend heavily on the direction of interest rates.
IEF Top Holdings and Sector Breakdown
IEF holds just 17 Treasury notes, and the index weights them by market value. Each holding sits between roughly 8% and 9%, so the portfolio is concentrated by position count but uniform in quality.
| Holding | Weight |
|---|---|
| US Treasury Note 4.625% (Feb 15, 2035) | 8.82% |
| US Treasury Note 4.25% (Nov 15, 2034) | 8.80% |
| US Treasury Note 4.25% (May 15, 2035) | 8.74% |
| US Treasury Note 4.00% (Nov 15, 2035) | 8.68% |
| US Treasury Note 4.375% (May 15, 2036) | 8.67% |
| US Treasury Note 4.125% (Feb 15, 2036) | 8.65% |
| US Treasury Note 4.375% (May 15, 2034) | 8.49% |
| US Treasury Note 4.00% (Feb 15, 2034) | 8.40% |
| US Treasury Note 4.25% (Aug 15, 2035) | 8.32% |
| US Treasury Note 3.875% (Aug 15, 2034) | 8.01% |
| Sector | Weight |
|---|---|
| US Treasury bonds (7–10 year maturities) | 99.99% |
The top 10 holdings account for about 85.6% of assets. That level of concentration would be a concern in a stock fund, but here every position is a U.S. government obligation, so the practical risk comes from interest rates rather than issuer selection.
IEF ETF Pros and Cons
Pros
- Pure Treasury exposure: The fund holds essentially 100% U.S. Treasuries, so it carries no corporate credit risk.
- Deep liquidity: With about $42.0 billion in assets and roughly 12.6 million shares trading daily, large orders may be filled with tight spreads.
- Monthly income: Distributions arrive every month, which may suit investors who want regular cash flow.
- Long track record: The fund has operated since 2002 and has tracked its index closely across market cycles.
- Focused maturity band: The 7–10 year range offers more yield than short-term Treasuries with less price sensitivity than 20+ year bonds.
Cons
- Interest-rate sensitivity: With a 6.8-year duration, a rise of one percentage point in yields has historically corresponded to a price decline of roughly 6.8%, partly offset by income.
- Higher fee than peers: At 0.15%, IEF costs five times as much as VGIT and SCHR, which each charge 0.03%.
- Weak multi-year returns: The fund posted -2.05% annualized over five years and just +0.10% over ten.
- No inflation protection: Fixed coupons lose purchasing power when inflation runs high, and the fund holds no TIPS.
Who Should Invest in IEF?
Whether IEF is a good investment depends on what role a bond fund plays in your portfolio, your time horizon and your tolerance for price swings.
IEF may be a good fit if you:
- Want a high-quality Treasury allocation concentrated in the 7–10 year range
- Hold a multi-year time horizon that could absorb interest-rate swings
- Value monthly distributions and a fund with a 20-plus-year history
- Trade in size and need a highly liquid bond ETF
- Prefer to build your own maturity ladder using separate ETFs
IEF may not be ideal if you:
- Prioritize the lowest possible expense ratio
- Need stable principal within the next year or two
- Want inflation-linked or credit-diversified bond exposure
- Are uncomfortable with price declines like the -3.73% one-year result
IEF Alternatives
| ETF | Expense Ratio | AUM | Key Difference |
|---|---|---|---|
| VGIT (Vanguard Intermediate-Term Treasury ETF) | 0.03% | ~$42B | Holds 3–10 year Treasuries, so duration is typically lower |
| SCHR (Schwab Intermediate-Term U.S. Treasury ETF) | 0.03% | ~$13B | Also covers 3–10 years at a very low fee, with a smaller asset base |
| IEI (iShares 3-7 Year Treasury Bond ETF) | 0.15% | ~$18B | Shorter maturity band, which generally means less rate sensitivity |
VGIT and SCHR hold a broader 3–10 year range at a fraction of IEF’s cost, which may appeal to investors who do not need a strict 7–10 year focus. IEI keeps the iShares structure and fee but stays in shorter maturities, so it could suit those who want less volatility. IEF remains the choice for investors who specifically want the 7–10 year band.
Related reading: [IEF vs VGIT Comparison] | [Best Bond ETFs] | [IEI ETF Review] | TLT ETF Review
Frequently Asked Questions
Is IEF a good long-term investment?
It depends on your goals. IEF has delivered +0.10% annualized over ten years, so most of its return has come from income rather than price gains. It may serve as a stabilizing, high-quality holding in a diversified portfolio, but its results have been sensitive to interest rates.
How often does IEF pay dividends?
IEF pays distributions monthly. Its trailing 12-month dividend yield was 4.07%, and its 30-day SEC yield was 4.99% as of October 22, 2026. Distributions are generally taxed as ordinary income at the federal level.
What is the difference between IEF and VGIT?
IEF holds only 7–10 year Treasuries across 17 positions and charges 0.15%. VGIT holds a broader 3–10 year range with many more holdings and charges 0.03%. As a result, VGIT typically carries a shorter duration, while IEF concentrates on the longer end of the intermediate curve.
Can I lose money investing in IEF?
Yes. Although Treasuries carry minimal credit risk, IEF’s share price changes as yields move. The fund lost 3.73% over the past year and 2.05% annualized over five years. Investors who sell after a rise in rates may realize a loss of principal.
How does IEF react to changing interest rates?
Bond prices generally move opposite to yields. With a 6.8-year average duration, IEF’s price has historically fallen when yields rose and gained when yields declined, with monthly income cushioning part of the swing. Holding the fund through a full rate cycle may reduce the impact of any single move.
Data as of November 2026. Sources: issuer websites and finance.yahoo.com.
Disclaimer: The information in this article is for educational and informational purposes only. It does not constitute financial, investment, or tax advice. Past performance is not indicative of future results. Investing in ETFs involves risk, including possible loss of principal. Always consult a qualified financial advisor before making investment decisions.