Furthermore, the U.S. Treasury increased debt issuance to fund a rising budget deficit from tax cuts and spending increases, with issuance in the first seven months of the year already surpassing the entire 2017.
Short End Targeted ETF Plays
Nevertheless, fixed-income investors can find attract yield opportunities in the short-end of the yield curve through targeted ETF plays. For example, the iShares 1-3 Year Treasury Bond ETF (NYSEArca: SHY), which focuses on U.S. Treasury bonds with remaining maturities between one and three years, has a 1.90 year effective duration, has a 2.48% 30-day SEC yield.
The iShares 0-5 Year TIPS Bond ETF (NYSEArca: STIP), which tracks short-term U.S. TIPS or government bonds whose face value rises with inflation, has a 2.28% 30-day SEC yield and a 2.71 year duration.
Additionally, the iShares Core 1-5 Year USD Bond ETF (NYSEArca: ISTB), which includes a broad basket of U.S. dollar-denominated bonds that are rated either investment grade or high yield with remaining maturities between one and five years, has a 3.09% 30-day SEC yield and a 2.70 year duration.
For more information on U.S. government debt, visit our Treasury Bonds category.