IBII vs STIP

IBIIBiShares iBonds Oct 2032 Term TIPS ETF

STIPAiShares 0-5 Year TIPS Bond ETF

In short

IBII Inflation-linked Treasuries with an end date. IBII holds only TIPS maturing in 2032, then winds up and pays out around October 15 of that year: a ladder rung for real-return investors rather than a perpetual bond fund.

STIP The short-fuse inflation hedge. STIP holds only inflation-linked Treasuries maturing inside five years, keeping the inflation link while sidestepping most of the long-bond rate swings. Three basis points a year.

Stated mandate

IBII The fund seeks to track an index of U.S. Treasury Inflation-Protected Securities maturing in 2032 and is designed to provide inflation protection with a defined maturity.

STIP The fund seeks to track an index of U.S. Treasury inflation-protected securities with maturities under five years, offering inflation hedging while managing duration risk.

Why people hold it

• IBII Defined maturity, like an individual bond: iBonds funds terminate on or about October 15 of the year in the name, which makes rung-by-rung ladder building straightforward.ishares.com
• The inflation-adjusted flavor of the ladder. Most target maturity rungs hold corporates or nominal Treasuries; this one holds TIPS, whose principal moves with inflation.ishares.com
• 0.10% expense ratio, in line with the typical target maturity bond ETF, for a single job: track the ICE 2032 Maturity US Inflation-Linked Treasury Index and pay quarterly.

• STIP Three basis points a year, roughly a quarter of the typical fee in its Treasury ETF group. On cost, this is near the floor for bond funds.
• Maturities capped under five years by design, so the inflation adjustment stays and the long-duration price swings largely do not.
• Running since 2010, a multi-billion-dollar fund that trades actively. Plain index construction, US Treasuries only.
• Sits in the upper half of the Treasury bond ETFs we cover, one of the stronger short-maturity builds in that group.

Worth knowing

• IBII In the final months the holdings mature into cash and cash-like instruments, so the yield drifts toward money market rates. The endgame is a payout, not a peak.ishares.com
• Narrow by design: just the TIPS issues maturing in 2032. And TIPS cut both ways, since the inflation adjustment can move down when prices fall.ishares.com
• Thinner trading than the corporate rungs of the iBonds lineup, so spreads can matter more on the way in and out. Distributions also vary rather than sitting at a fixed coupon.ishares.com

• STIP Short bonds accrue less inflation compensation than long-dated TIPS, and prices still move with real yields. This is a dampened hedge, not a pure one.
• Distributions are irregular. Payouts ride the inflation adjustment, so income arrives lumpy rather than as a steady check.
• Around 25 bonds, all at the front of the curve. SCHP spans the full TIPS maturity range for the same 0.03%.

Full IBII profile⁠

Full STIP profile⁠