BOXX vs VGSH

BOXXBAlpha Architect 1-3 Month Box ETF

VGSHAVanguard Short-Term Treasury ETF

In short

BOXX A T-bill fund that owns no T-bills. BOXX builds its 1-3 month Treasury bill payoff out of exchange-listed box spread options, so the return shows up in the share price instead of a stream of interest payments.

VGSH Plain one-to-three-year Treasuries for three basis points, running since 2009. No credit story, no active twist: VGSH owns the short end of the government curve and charges about as little as this category allows.

Stated mandate

BOXX The fund seeks to match or exceed, before expenses, the price and yield performance of the 1–3 month segment of the U.S. Treasury bill market.

VGSH The fund seeks to track a market-weighted Treasury index with a short-term dollar-weighted average maturity.

Why people hold it

• BOXX No bills in the box: the fund stacks long and short exchange-listed options (long call plus short put at one strike against the reverse at another) into a payoff that behaves like short-term fixed income.alphaarchitect.comalphaarchitect.com 2
• Nothing drips out along the way. A box spread throws off no coupon, so the fund has not been paying regular income distributions; the issuer frames it as an options-based alternative to an ultrashort bond position.alphaarchitect.com
• A multi-billion-dollar fund that trades actively, and it has stuck closely to the 1-3 month bill market it benchmarks against, which puts it in the upper half of its short-Treasury peer group.

• VGSH 0.03% a year, against a 0.15% median for 1-3 year Treasury funds. Same fee floor as SCHO and SPTS, and a fifth of what SHY charges for the same slice of the curve.
• Sticks tightly to the Bloomberg U.S. Treasury 1-3 Year Index, one of the closest-tracking implementations in its peer group.
• Roughly 90 US Treasury issues, sampled to match the index. No corporates, no mortgages, no derivatives overlay: the only credit question is the US Treasury itself.
• Pays monthly, and the income resets as short notes mature and newer ones roll in, so it moves with prevailing short-term rates. A multi-billion-dollar fund that trades actively.

Worth knowing

• BOXX You pay for the plumbing: 0.19% net of a waiver through February 1, 2027 (0.24% gross), near the category median but above plain bill trackers SPTS, SCHO and VGSH at 0.03%.etfarchitect.com
• The tax angle is not settled. The prospectus itself flags that the tax code offers no clear guidance for this strategy, so the treatment of gains could change or be challenged.etfarchitect.com
• Actively managed, not index-tracking: the payoff rests on the manager rolling box spreads in the listed options market rather than on a portfolio of Treasuries.alphaarchitect.com

• VGSH Short maturities soften rate moves, they don't erase them. Prices still fall when yields rise, and the fund itself has no maturity date the way a single note does.
• At the short end the cost race is a tie, not a win: SCHO tracks the same index for the same 0.03%. Differences show up in trading and plumbing, not the fee line.
• Nothing here reaches for yield: no corporate credit, no inflation linkage, no long bonds. That narrowness is the design, and it behaves nothing like a core bond fund.

Full BOXX profile⁠

Full VGSH profile⁠