FLGV vs GOVT

FLGVBFranklin U.S. Treasury Bond ETF

GOVTAiShares U.S. Treasury Bond ETF

In short

FLGV Treasuries only, anywhere from 1 to 30 years, in one ticker. Franklin charges 0.09%, under the typical fee in its Treasury peer group, and the income lands monthly.

GOVT The plain-vanilla Treasury sleeve. One index fund spanning the full maturity spectrum of US government debt, running since 2012 at five basis points, with none of the credit risk that lives in the rest of the bond aisle.

Stated mandate

FLGV The Fund seeks income and normally invests at least 80% of net assets in direct U.S. Treasury obligations and related Treasury exposures. It may hold Treasury securities of any maturity, with primary emphasis on remaining maturities from 1 to 30 years.

GOVT The fund seeks to track an index of U.S. Treasury bonds spanning the full maturity spectrum, providing broad exposure to U.S. government debt for stability and income.

Why people hold it

• FLGV One ticker for the whole Treasury curve: at least 80% of net assets in direct U.S. Treasury obligations, with the emphasis on maturities running 1 to 30 years.
• 0.09% a year undercuts the 0.12% median for Treasury funds in its peer group. On government paper, where yields are what they are, the fee is the lever you control.
• Pays monthly, and it is a multi-billion-dollar fund, so the income arrives on a predictable schedule rather than in quarterly lumps.
• Since its 2020 launch it has hewed tightly to its stated Treasury mandate, one of the closer mandate matches in a crowded Treasury peer group.

• GOVT Charges 0.05% a year, well under the median fee in its broad-Treasury peer group.
• Tracks the ICE US Treasury Core Bond Index tightly, one of the cleaner index implementations among broad Treasury funds.
• A multi-billion-dollar fund that trades heavily, which tends to show up as thin bid-ask spreads for retail-size orders.
• US Treasury debt and nothing else, paid out monthly. No corporate credit to underwrite, no mortgage prepayments to model.ishares.com

Worth knowing

• FLGV Cheaper shelf-mates exist: VGIT and VTG run 0.03%, a third of this fee. You are paying a bit more for Franklin's version of the same government paper.
• Moderately traded rather than one of the tape's busiest Treasury funds, so spreads matter more on large or hurried orders.
• Holdings can stretch out to 30-year maturities, so this carries real interest-rate sensitivity, not the calm of a T-bill fund.

• GOVT Covering the full maturity spectrum means long-dated bonds are in the mix, so the share price moves with interest rates more than a short-dated Treasury fund's would.
• Nominal Treasuries only. Inflation-linked exposure sits in different funds, such as SPIP or VTP.
• SPTB runs the same broad-Treasury idea at 0.03%, two basis points less.

Full FLGV profile⁠

Full GOVT profile⁠