Treasury Ladders & Yield Math

Key Institutional Takeaways — Treasury Ladders & Yield Math

• 30-Day SEC Yield measures net annualized yield-to-maturity income over the prior 30 days minus accrued operating expenses [Form N-1A Item 26, SEC, 2026-10-15], whereas 12-Month Distribution Yield tracks backward-looking cash payouts divided by current NAV.
• In ultra-short 0–3 month U.S. Treasury ETFs, a 10.56 bps expense ratio gap—3.00 bps net for SGOV vs. 13.56 bps for BIL [Fund Prospectus Filings, SEC EDGAR, 2026-10-01]—creates $1,482 in cumulative fee drag per $100,000 over a 10-year compounding horizon at a 4.35% gross yield [ETFYield Lab Fee Simulator, 2026-10-20].
• Extending duration from SGOV (effective duration 0.09 years) to IEF (7.14 years) or TLT (15.82 years) increases price sensitivity (DV01) from $0.90 to $158.20 per $100,000 allocation per 100 bps parallel yield shift [U.S. Treasury Par Yield Curve & Fund Fact Sheets, 2026-10-16].
• Taxable U.S. investors holding 99.8% direct U.S. Treasury obligations inside SGOV or BIL capture an additional 22 bps to 48 bps in tax-equivalent yield compared to fully taxable bank money market sweeps in high-tax states [U.S. Department of the Treasury / IRS Pub 550, 2026-10-01].
• iShares 0-3 Month Treasury Bond ETF (SGOV) Yield & Fee Benchmark (SGOV-0-3M-UST) prints at 4.31% (30-Day SEC Yield (3 bps ER)) under SEC Form N-1A / U.S. Treasury supervision as of 2026-10-20.
• Cross-benchmark analysis against SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) Liquidity & Fee Audit (4.20% 30-Day SEC Yield (13.56 bps ER), Source: SEC EDGAR / State Street, 2026-10-20) confirms structural divergence across Form N-1A Item 26 accrual accounting versus backward-looking dividend cash flows.

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