T. Rowe Price Ultra Short-Term Bond ETF

TBUX

Market cap $821M

The T. Rowe Price Ultra Short-Term Bond ETF (TBUX) is rated a Buy for income-focused investors seeking yields above CDs and money markets. TBUX offers a 4.79% yield, strong credit quality (A+ average), and outperforms peers and its benchmark in total returns. Actively managed with a short duration (0.67 years) and diversified holdings, TBUX balances higher-yield BBB bonds with AAA allocations.

Rates have already come down once this year, but with another Fed meeting on the horizon portending a further potential cut, investors may be looking at their options. That shifting rate environment presents opportunities for investors as well as some potential pitfalls.

TBUX offers broad bond exposure with low duration and moderate credit risk, but lacks meaningful credit upside as credit spreads are near historical lows. You pay for that additional curation with around 0.02% more expense ratios than duration-comparable iShares Treasury ETFs. The macro backdrop is stable, with inflation moderating and Fed rate cuts likely, making longer duration bonds more tactical than ultra-short options like TBUX.

The second half brings with it ongoing volatility, tariff uncertainty, and lack of definitive market consensus as to what lies ahead. For advisors and investors wanting to increase defensive plays within bonds, the T.

Don't hold your breath for dollar recovery odds this summer. After the worst first half for the U.S. dollar since Nixon's presidency, risk factors remain elevated in the near term.

July kicks off the beginning of the second half for markets, one likely riddled with ongoing uncertainty and rising risks. Despite recent stock gains, T.

With U.S. tariff impacts becoming more apparent this summer, T. Rowe Price looks to opportunities, risks, and trends in the back half of the year.

The Federal Reserve extended its wait-and-see interest rate policy at the June FOMC meeting. Officials also appear increasingly divided over the path of interest rates in the second half, prolonging investor and market uncertainty about second half outlooks.

This year's market environment remains a favorable one for active ETFs, with approximately 40% of flows funneling into the strategies year-to-date. As investors increasingly look beyond benchmark constraints for opportunity, T.

Advisors and investors seeking opportunities beyond passive bond benchmarks, or looking to reduce risk, would do well to consider active fixed income ETFs. In the mercurial markets of 2025, strategies that rely on fundamental analysis to construct portfolios while remaining flexible could prove beneficial.