Additional stimulus measures and better-than-expected corporate earnings gave Treasury yields a boost as equities jumped higher during Wednesday’s trading session. Crude oil futures also helped bring yields higher after the commodity traded in negative territory for the first time ever this week.

“While the oil market likely has many hurdles ahead of it, today’s rebound was not only good for the equity market, it was good for the bond market because it represents a level of calm that is needed right now,” said Kevin Giddis, chief fixed income strategist at Raymond James, in a note.

A new fiscal stimulus package is slated to infuse another $500 billion into the economy to help shore up small businesses that have been hit especially hard during the coronavirus outbreak.

“You have unprecedented monetary involvement. That’s certainly one of the most powerful forces helping people look through that short-term malaise,” said Christian Hoffmann, portfolio manager at Thornburg Investment Management, in an interview.

Investors looking to get short-term exposure to Treasurys can look to funds like the Goldman Sachs Access Treasury 0-1 Year ETF (GBIL). GBIL seeks to provide investment results that closely correspond, before fees and expenses, to the performance of the FTSE US Treasury 0-1 Year Composite Select Index.

The fund seeks to achieve its investment objective by investing at least 80% of its assets (exclusive of collateral held from securities lending) in securities included in its underlying index. The index is designed to measure the performance of U.S. Treasury Securities with a maximum remaining maturity of 12 months. The investment adviser uses a representative sampling strategy to manage the fund.

GBIL Chart

GBIL data by YCharts

Additionally, investors can look at the iShares Short Treasury Bond ETF (NasdaqGM: SHV). SHV seeks to track the investment results of the ICE U.S. Treasury Short Bond Index, which measures the performance of public obligations of the U.S.

Treasuries that have a remaining maturity of equal to or greater than one month and less than one year. Additionally, the fund may invest up to 10% of its assets in U.S. government bonds not included in the underlying index, but which BFA believes will help the fund track the underlying index.

Investors can also take a look at the iShares 20+ Year Treasury Bond ETF (NasdaqGS: TLT). TLT seeks to track the investment results of the ICE U.S. Treasury 20+ Year Bond Index (the “underlying index”). The underlying index measures the performance of public obligations of the U.S. Treasury that have a remaining maturity greater than or equal to twenty years.

Advantages of adding TLT to your portfolio:

  • Exposure to long-term U.S. Treasury bonds
  • Targeted access to a specific segment of the U.S. Treasury market
  • Use to customize your exposure to Treasuries

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