iShares 0-3 Month Treasury Bond ETF

SGOV

Market cap $64.5B

U.S. bonds are outperforming after years of volatility, with 10-year Treasury yields falling as inflation pressures moderate even with some prices still elevated.

The ETF wrapper has come along in leaps and bounds since the ETF rule's arrival in 2019. The tax-efficient, flexible, transparent wrapper offers myriad advantages for their investors, but historically, equity ETF adoption has happened faster.

With $1.01 trillion of net inflows for the year, ETFs are sure to break the 2024 record of $1.1 trillion, likely in November. However, with $325 billion of new money as of October 15, fixed income ETFs have already hit a new milestone for the year.

Bond ETFs like SGOV and SCHO gain traction as Treasury yields sink to three-year lows, reflecting rising investor caution amid mounting market stress.

For those who adopt a dividend strategy, having a “thermometer” with which to measure the real performance of our stocks is an immense advantage. This thermometer is NAV, a simple line on a graph that anyone can observe and understand without the need for calculations or interpretations. If it grows over the years, it means that the security earned its distributions: if it goes down, it means that it paid them at the expense of NAV.

It's October, and ETFs are closing in on the $1 trillion mark for net inflows in 2025 (We have $997 billion as of October 9). This is a monumental achievement given this milestone was first crossed in a calendar year only last December.

The popularity of ETFs continues to surge this year. And investors definitely have a type they prefer.

Active ETFs issuance has been torrid since 2021. At the start of that year there were 535 active ETFs versus 1,959 passive ETFs.

SGOV is a simple, short-term Treasury ETF with minimal duration, exceptional credit quality, and near-zero volatility - ideal for cash management. The 0.09% expense ratio is among the best in its category, making SGOV a cost-effective choice for parking cash. I use SGOV and similar Treasury ETFs as cash alternatives for personal, business, and portfolio idle funds, rather than chasing bank rates.

SGOV is designed for low-risk, highly liquid cash management, offering slightly higher returns than a bank account with minimal credit and interest rate risk. It's not a tool for long-term capital growth, but ideal for parking emergency funds or short-term savings within a balanced portfolio. SGOV's structure ensures easy access, negligible spread, and virtually no risk of a redemption cascade, making it reliable in both normal and stressed markets.