Looking to freshen up your fixed income allocation? It may be worth taking a look at some of the short-term Treasury offerings out there. One strategy focused on the short end of the curve, TBIL, could stand out. TBIL, the US Treasury 3 Month Bill ETF, recently crossed $3 billion in total AUM. The 3 month Treasury ETF stands out as a single security ETF. It comes from a family of Treasury ETFs from F/m Investments LLC, the Benchmark Series.
In the 18 months or so that have passed since the series arrived, the suite has gathered more than $4 billion in total AUM. That may speak to investor interest in getting solid yields from a renewed rate market, with growing demand for options at the short end of the curve, according to F/m Investments’ president and CIO Alexander Morris.
“In a market inundated recently by novel asset classes and even cryptocurrencies, the US Benchmark Series ETFs – both short and longer durations – are attracting assets from investors seeking duration exposure with the clarity and precision that these ETFs enable,” Morris said.
TBIL’s 3-Month Treasury ETF Approach
So, how exactly does the 3 month Treasury ETF go about its business? The strategy tracks the ICE BofA US Treasury Bill 3 Month Index for a 15 basis point (bps) fee. In doing so, it has returned 5.2% over the last year, per VettaFi’s ETF Database. That total has outperformed both its ETF Database Category and Factset Segment averages.
Why, then, might investors want to consider TBIL moving forward? While investors continue to expect rate cuts from the Fed, they haven’t arrived yet. Secure yields from the short end of the curve will likely still offer a nice boost to portfolios. For investors looking to move out of cash, the 3 month Treasury ETF and its surging momentum may stand out as a solid option.
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