Alpha Architect 1-3 Month Box ETF

BOXX

Market cap $9.02B

BOXX hits a 52-week high as investors flock to cash-like assets amid market volatility and rising economic uncertainty.

Interest rates remain elevated, with high-quality, lower-risk bonds and income securities offering competitive yields. Market volatility has some investors worried, and looking for safer investments. ETFs focusing on high-quality, lower-risk, short-term securities seem like particularly interesting choices right now. A quick look at four of these follows.

BOXX provides a yield premium over T-bills by buying box spreads, all while maintaining minimal credit and duration risk. It offers unique tax efficiency for taxable accounts, effectively converting ordinary interest income into deferred capital gains. For options traders, BOXX is a superior collateral tool, featuring immediate marginability and eliminating the wash sale issues inherent to T-bill ETFs with distributions.

BOXX climbs to a 52-week high as market volatility drives investors toward cash-like, low-risk ETF options.

BND is one of the largest bond ETFs in the market. It tracks a simple bond index, providing investors with diversified, broad-based exposure to these investments. BND compares unfavorably to several of its peers on different grounds, including dividend yield, returns, risk-adjusted returns, and tax benefits.

Smart beta and active strategies helped four diverse ETFs outperform and hit 52-week highs amid shifting macro trends. From defensive utilities to innovation-driven tech, these ETFs are thriving by rejecting traditional market-cap indexing.

BOXX is a potentially higher yielding, more tax efficient, low-cost cash alternative. BOXX is a stable, low-risk alternative to money markets, other cash equivalents, and cash alternatives. The higher returns plus potential tax efficiency can provide meaningful improvements in after-tax returns.

BOXX, an ultrashort bond ETF, receives the highest Quant rating among 61 similar funds, despite a general Quant bias against ultrashort bonds. The ETF employs a box strategy using FLEX options from the OCC, offers attractive dividends and yield, and has a tax-advantaged structure. Overall, BOXX stands out as a compelling cash-equivalent option, especially for investors seeking T-Bill yield with tax efficiency.

I reiterate a buy rating on BOXX due to its steady performance amid market volatility and tax efficiency for high-income investors. BOXX closely tracks the SPDR Bloomberg 1-3 Month T-Bill ETF and slightly outperforms it on a total return basis. BOXX's assets under management have surged from $1 billion to $6.1 billion, with low annual expense ratios and increasing trading volume.

A few ETFs are touching new 52-week highs amid the market turmoil.