SCHP vs TDTT

SCHPASchwab US TIPS ETF

TDTTBNorthern Trust iBoxx 3-Year Target Duration TIPS ETF

In short

SCHP Inflation insurance in the plainest wrapper available: SCHP owns the full maturity range of Treasury inflation-protected bonds and tracks its Bloomberg index for three basis points a year.

TDTT TIPS duration wanders as inflation expectations shift. TDTT's index pins it, targeting a modified adjusted duration of 3.0 years and rebalancing monthly: inflation-linked Treasuries on a short leash.

Stated mandate

SCHP The fund seeks to track, before fees and expenses, the total return of an index composed of inflation-protected U.S. Treasury securities.

TDTT The Fund seeks to track, before fees and expenses, the price and yield performance of the iBoxx 3-Year Target Duration TIPS Index. It uses a passive indexing approach, generally replicating the index or using representative sampling when full replication is impracticable.

Why people hold it

• SCHP 0.03% a year, a quarter of the typical Treasury-fund fee and level with the cheapest names in the group (VGIT, VCSH).
• One job, done literally: only inflation-linked US Treasuries, whose principal adjusts with the official consumer price index.
• Running since 2010, now a multi-billion-dollar fund that trades actively and hugs the Bloomberg Series-L index closely.
• Passive, no maturity tilt, no manager view: one of the cleaner builds among Treasury ETFs.

• TDTT The index targets a modified adjusted duration of 3.0 years, resets when it strays past a 5% band, and rebalances monthly. Duration is the design, not a byproduct.flexshares.comflexshares.com 2
• Built from TIPS with one to ten years to maturity and at least $2 billion outstanding, so the sleeve leans on the biggest, most tradable issues.flexshares.comflexshares.com 2
• Listed in 2011 and now a multibillion-dollar fund from Northern Trust, long past the stage where a niche bond ETF is fighting for scale.

Worth knowing

• SCHP Inflation-linked is not rate-proof. This spans the whole maturity spectrum, so prices move with real yields.
• Distributions are irregular. Coupons sit on an inflation-adjusted principal, so the cash arrives lumpy, not as a steady check.
• About 50 bonds, all Uncle Sam. No credit spread, no corporate yield pickup; inflation and duration are the whole story.

• TDTT 0.18% net of a waiver through March 1, 2027 (0.19% gross), above the category median. Plain market-cap TIPS funds like SCHP and VTIP charge 0.03%.
• Pinning duration near three years is a middle setting: it moves less with rates than long TIPS, more than cash-like short TIPS.flexshares.com
• TIPS coupons move with CPI adjustments, so payouts land on an irregular schedule and vary in size rather than arriving as a steady check.flexshares.com

Full SCHP profile⁠

Full TDTT profile⁠