When Treasury yields plunged last year, EDV and ZROZ fought for top honors among non-leveraged bond ETFs with ZROZ winning with a 48.7% 2014 gain. EDV, the Vanguard offering, rose 44.7%. That average gain of 46.7% easily trumped the 27.3% returned last year by the iShares 20+ Year Treasury Bond ETF (NYSEArca: TLT).
Since the start of April, investors have pulled nearly $13 million from EDV while adding $6.4 million to ZROZ.
“Zeros are a small slice of the $12.6 trillion U.S. government bond market. At the end of March, the total outstanding value of zero-coupon Treasury bonds stood at $212.billion, up from $204.7 billion at the end of 2013,” according to the Journal.
PIMCO 25+ Year Zero Coupon US Treasury Index ETF
Tom Lydon’s clients own shares of TLT.