- After a strong run over the last 12 months, these short-term Treasury ETFs are now yielding very close to zero.
- There’s little upside potential and little yield benefit over Treasury money market funds, which lock in your share price at $1.
- Are these ETFs a risky investment? No, they are fine. But the reward-versus-risk equation doesn’t look appealing.
Over the last year, as short-term interest rates dropped dramatically, a lot of investors poured money into short-term Treasury ETFs as a way to capture a yield advantage over a money market account, while retaining safety.
Unfortunately, those days are over.