GOVZ vs TLT

GOVZBiShares 25+ Year Treasury STRIPS Bond ETF

TLTBiShares 20+ Year Treasury Bond ETF

In short

GOVZ Treasury bonds with the coupons stripped off, 25 years and out. No interest payments means extreme duration and price swings to match, for 0.10% net of a waiver through February 28, 2029.

TLT The long bond's most famous ticker. iShares launched TLT in 2002, and it became the default way to take a view on 20-year-plus Treasuries: index-tracked, heavily traded, with a deep listed options market.

Stated mandate

GOVZ The fund seeks to track an index of principal STRIPS from U.S. Treasury bonds with at least 25 years remaining to maturity.

TLT The fund seeks to track an index of U.S. Treasury bonds with remaining maturities greater than twenty years, providing targeted exposure to long-duration government debt.

Why people hold it

• GOVZ Tracks the ICE BofA Long US Treasury Principal STRIPS Index, the same index as ZROZ (0.15%), for 0.10% net of a waiver through February 28, 2029 (0.15% gross). Sits near the category median on fee.
• Owns only principal STRIPS, the zero-coupon remains of Treasury bonds. Because they make no periodic interest payments, duration runs longer and rate moves land harder than on traditional notes and bonds.sec.gov
• Pays monthly, even though the bonds inside send no coupons. The underlying paper is US Treasury obligations, with no corporate credit in the mix.

• TLT Pure long-duration Treasuries: it tracks the ICE U.S. Treasury 20+ Year Bond Index, government debt maturing in 20 years or more, no corporate credit, no short-end dilution.ishares.com
• One of the most actively traded bond ETFs, with a deep listed options market around it, so positions and hedges can be built and unwound on-screen.marketchameleon.com
• Running since 2002 and now a multi-billion-dollar fund, paying distributions monthly.

Worth knowing

• GOVZ The flip side of max duration: the prospectus notes STRIPS market values generally swing more with interest rates than regular Treasuries. That works in both directions.sec.gov
• Cheaper long-Treasury options exist: EDV charges 0.05% (also STRIPS-based, different index) and VGLT 0.03% (coupon-paying bonds, shorter duration). Neither is a 25-year-plus principal STRIPS pure play.
• A mid-sized fund that trades more lightly than the category's giants, so bid-ask spreads can be wider, especially on large or off-hours orders.

• TLT You pay for that liquidity: 0.15% a year, while BBLB tracks the very same index for 0.04% and VGLT charges 0.03% for long Treasuries.
• Long duration cuts both ways. Bonds this far out the curve move sharply when long-term yields shift, so the ride is far more volatile than a short-term Treasury fund.ishares.com
• Concentrated by design: roughly 50 Treasury bonds clustered at the long end, and the monthly payout floats with the coupons of whatever the index holds.

Full GOVZ profile⁠

Full TLT profile⁠