Shutdown Averted! Now Buy Some Treasuries

On Friday, many considered a government shutdown to be inevitable. But late Saturday night, Congress surprised everyone by getting its act together and passing a last-minute spending bill. So, the U.S. was able to avert a shutdown.

Chamber of Commerce chief policy officer Neil Bradley was “pleased that the ‘adults’ stepped up to prevent a shutdown.” He added that a shutdown would have caused “direct harm… to millions of Americans and American small businesses.”

And as an added bonus that the government avoided closure, Treasury yields rose on Monday. CNBC reported that the 10-year Treasury yield was at 4.693% at 4:18 p.m. ET. The two-year Treasury yield, meanwhile, was 5.112%.

See more: “Treasuries Offering Yields Not Seen in Over a Decade

A Suite of Treasuries ETFs

Vanguard offers a suite of three U.S. Treasury ETFs of varying durations. The Vanguard Short-Term Treasury ETF (VGSH) invests primarily in investment-grade (IG) U.S. Treasury bonds with a dollar-weighted average maturity of one to three years. Meanwhile, the Vanguard Intermediate-Term Treasury ETF (VGIT), targets IG Treasuries with an average maturity of five to 10 years. And the Vanguard Long-Term Treasury ETF (VGLT) invests in Treasuries with an average maturity of 10 to 25 years.

All three funds have an expense ratio of 4 basis points.

Low Cost and High Performing

VettaFi’s vice chairman Tom Lydon called Vanguard “the Hoover of the ETF industry” for how it’s vacuumed up investor dollars.

“They are just rock solid. They have so many choices. They’re low-cost and always very, very dependable,” he said.

Vanguard’s CEO Tim Buckley said at Exchange 2023 that the firm’s goal is “to make sure we’re producing the top-performing funds and ETFs out there.”

“We’ll wrap it with low-cost, scalable advice and deliver them on a world-class, digitally enabled platform,” he added. “And if you do that well and you can keep improving it, you’ll create value into the future.”

For more news, information, and analysis, visit the Fixed Income Channel.