US Treasury 3 Month Bill ETF Stock Price, News & Analysis

The US Treasury 3 Month Bill ETF (TBIL) is an exchange-traded fund that seeks to give investors targeted exposure to the short end of the US Treasury yield curve. According to F/m Investments, the investment objective of TBIL is to seek investment results that correspond, before fees and expenses, generally to the price and yield performance of the ICE BofA US 3-Month Treasury Bill Index (G0O1). The index is described as being comprised of a single US Treasury bill purchased at the beginning of the month and held for a full month, then rolled into a newly selected issue that matures closest to, but not beyond, three months from each month-end rebalancing date.

TBIL is one of ten US Treasury ETFs in F/m Investments’ US Benchmark Series. Each ETF in the Series is designed to hold the most current, or “on the run,” US Treasury security that corresponds to its stated tenor. For TBIL, this means exposure to the current US 3 Month Treasury Bill. F/m Investments has described the Series as a way for investors of all sizes to own each of the benchmark US Treasuries in a single-security ETF, providing access to US Treasuries at ten specific points across the US Treasury yield curve.

Core strategy and structure

The ICE BofA US 3-Month Treasury Bill Index methodology, as cited in fund-related disclosures, involves holding a single Treasury bill for a month and then selling and rolling into a newly selected bill that meets the index’s maturity criteria. TBIL’s objective of tracking this index means the fund is structured to reflect the price and yield behavior of very short-term US Treasury bills. The fund’s focus on the 3-month tenor places it at the short-duration end of the yield curve among the US Benchmark Series ETFs.

F/m Investments notes that each ETF in the US Benchmark Series holds the most current, or on-the-run, US Treasury security that corresponds to its tenor. An on-the-run security is described as the most recently issued of a periodically issued security, as opposed to an off-the-run security that was issued earlier and remains outstanding. This periodic transition to the most recently auctioned Treasury security is intended to maintain exposure to the benchmark tenor.

Role within the US Benchmark Series

TBIL is specifically identified in F/m Investments’ communications as the US Treasury 3 Month Bill ETF and as one of the initial ETFs listed when the US Benchmark Series launched. The Series includes ETFs tied to multiple tenors, such as 6-month and 12-month Treasury bills and various Treasury notes and bonds, giving investors tools to access different points on the US Treasury yield curve. TBIL has been highlighted in multiple announcements as a recognized product within this lineup and as part of a broader effort to provide efficient access to US Treasury securities.

F/m Investments has reported that TBIL has crossed several asset milestones since launch, including reaching and then surpassing multiple billions of dollars in assets under management. These milestones have been cited in the context of investor demand for accessible and precise Treasury investments and for exposure to the short end of the yield curve.

Risk considerations

Fund disclosures emphasize that investments involve risk and principal loss is possible. TBIL is described as being subject to interest rate risk, defined as the risk of losses attributable to changes in interest rates. In general, if prevailing interest rates rise, the values of debt instruments tend to fall, and if interest rates fall, the values of debt instruments tend to rise. Because TBIL focuses on US Treasury bills, its performance is sensitive to movements in short-term interest rates.

Disclosures also state that the UST 3 Month Bill Fund may be susceptible to an increased risk of loss to the extent its investments are concentrated in a particular issue, issuer or issuers, country, market segment, or asset class. While US Treasury obligations are described as being backed by the “full faith and credit” of the US Government, they are nonetheless subject to credit risk, defined as the risk that the US Government may be, or be perceived to be, unable or unwilling to honor its financial obligations, such as making payments.

Trading and access

As with all ETFs, disclosures note that shares of TBIL may be bought and sold in the secondary market at market prices. This ETF structure allows investors to access the fund through equity trading and settlement mechanisms. TBIL is part of a suite of US Treasury ETFs that F/m Investments has described as tools that investors can use to manage duration, yield exposure, and risk along the US Treasury yield curve.

Background and sponsor

TBIL is sponsored and managed within the F/m Investments platform. F/m Investments is described in multiple announcements as a multi-boutique investment firm and investment advisor that provides diversified investment strategies to advisors and institutional investors across asset classes, markets, and styles. The firm has also been described as a registered investment advisor and as a wholly owned subsidiary of Diffractive Managers Group in earlier communications about the Series.

The launch of TBIL and the US Benchmark Series was announced as a collaboration between F/m’s brands North Slope Capital LLC and Genoa Asset Management LLC, with support from The RBB Fund, Inc. F/m has characterized the US Benchmark Series as designed to make it easier for investors to access the US Treasury market and to equitize the yield curve by offering ETFs that track ICE indices specific to each tenor.

Summary of key characteristics

• Fund type: Exchange-traded fund focused on US Treasury securities.
• Target exposure: Current US 3 Month Treasury Bill.
• Stated objective: Seek investment results that correspond, before fees and expenses, generally to the price and yield performance of the ICE BofA US 3-Month Treasury Bill Index (G0O1).
• Series membership: One of ten US Treasury ETFs in F/m Investments’ US Benchmark Series, each holding the most current on-the-run US Treasury security for its tenor.
• Primary risks cited: Interest rate risk, concentration risk related to the fund’s focus on specific US Treasury securities, and credit risk associated with US Treasury obligations.

FAQs about US Treasury 3 Month Bill ETF (TBIL)

• What is the investment objective of the US Treasury 3 Month Bill ETF (TBIL)?
  According to fund disclosures, the investment objective of TBIL is to seek investment results that correspond, before fees and expenses, generally to the price and yield performance of the ICE BofA US 3-Month Treasury Bill Index (G0O1).
• What does TBIL invest in?
  TBIL is described as part of the US Benchmark Series of US Treasury ETFs. Each ETF in the Series holds the most current, or on-the-run, US Treasury security that corresponds to its stated tenor. For TBIL, that tenor is the US 3 Month Treasury Bill, and the fund seeks to reflect the behavior of the ICE BofA US 3-Month Treasury Bill Index.
• How does the ICE BofA US 3-Month Treasury Bill Index work?
  Disclosures state that the index is comprised of a single US Treasury bill purchased at the beginning of the month and held for a full month. At the end of the month, that issue is sold and rolled into a newly selected issue. The selected issue is the outstanding Treasury bill that matures closest to, but not beyond, three months from the rebalancing date and must have settled on or before that date.
• What is the US Benchmark Series and how does TBIL fit into it?
  The US Benchmark Series is described as a suite of US Treasury ETFs that allows investors of all sizes to own each of the benchmark US Treasuries in a single-security ETF. Each ETF holds the most current on-the-run US Treasury security that corresponds to its tenor. TBIL is the US Treasury 3 Month Bill ETF within this Series and represents the short end of the yield curve among the ten ETFs.
• What risks are associated with investing in TBIL?
  Fund disclosures highlight interest rate risk, meaning the risk of losses attributable to changes in interest rates, and note that if prevailing interest rates rise, the values of debt instruments tend to fall, while if interest rates fall, the values of debt instruments tend to rise. The UST 3 Month Bill Fund is also described as potentially being susceptible to increased risk of loss when its investments are concentrated in particular issues, issuers, or market segments. In addition, while US Treasury obligations are backed by the full faith and credit of the US Government, they are nonetheless subject to credit risk.
• How is TBIL traded?
  As with all ETFs mentioned in the disclosures, shares of TBIL may be bought and sold in the secondary market at market prices. This allows investors to access the fund through standard equity trading channels.
• Who manages TBIL?
  TBIL is part of the US Benchmark Series sponsored by F/m Investments. F/m Investments is described as a multi-boutique investment firm and registered investment advisor that provides diversified investment strategies to advisors and institutional investors.
• How does TBIL provide exposure to the short end of the yield curve?
  By seeking to track the ICE BofA US 3-Month Treasury Bill Index and by holding exposure to the current on-the-run US 3 Month Treasury Bill through its index-tracking objective, TBIL is positioned at the short-duration end of the US Treasury yield curve within the US Benchmark Series.