SHV vs VUSB

SHVAiShares Trust iShares 0-1 Year Treasury Bond ETF

VUSBAVanguard Ultra-Short Bond ETF

In short

SHV iShares' T-bill parking spot since 2007: nothing but US Treasuries maturing inside a year, rolled continuously, with income paid monthly. No corporate credit, no duration bets, 0.15% a year.

VUSB Vanguard's first actively managed bond ETF, run by its in-house fixed income team and priced at 0.10%. It holds investment-grade paper maturing inside two years: a step past a money fund, well short of a real bond fund.

Stated mandate

SHV The fund seeks to track an index composed of U.S. Treasury bonds with remaining maturities of one year or less.

VUSB The fund seeks current income with limited price volatility while investing in diversified high- and medium-quality fixed-income securities. It expects to maintain a dollar-weighted average maturity of 0–2 years.

Why people hold it

• SHV Treasuries only, by mandate. The index it tracks holds US government debt maturing in a year or less, so no corporate credit enters the portfolio.ishares.com
• 0.15% a year, below the typical ultra-short bond fund, from a multi-billion-dollar fund that has been running since 2007.
• One of the more heavily traded names in the ultra-short space, and it has hugged its benchmark closely, which matters when the whole return is T-bill yield.
• Income arrives monthly rather than quarterly.

• VUSB At 0.10%, it costs half the typical ultra-short bond ETF and undercuts the other leaders in the group: SHV, PULS, FLDR and DUSB all charge 0.15%.
• Active, not adventurous. The managers buy investment-grade bonds (A3-or-better high quality plus BBB-tier medium quality) and hold average maturity to zero-to-two years.vanguard.com
• Income lands monthly, sourced from roughly 170 bonds, so no single issuer drives the outcome.
• A multi-billion-dollar fund that trades actively, and the same portfolio team also runs a similar Vanguard ultra-short fund.vanguard.com

Worth knowing

• SHV Payouts float with T-bill rates. Holdings mature and reroll within a year, so income resets quickly in both directions.
• Cheaper exists: Vanguard's VUSB charges 0.10% among the top-ranked ultra-short peers.
• This is the quiet corner of the bond market. By design there is no credit spread pickup and almost no interest-rate exposure to work with.

• VUSB This is not a money market fund. No fixed $1 share price, and the market price can trade above or below the value of the holdings.vanguard.com
• The mandate allows BBB-tier credit, a notch of risk a Treasury-only neighbor like SHV doesn't take.vanguard.com
• Bonds this short reprice with short-term rates, so the monthly payout drifts up and down instead of holding a set level.vanguard.com

Full SHV profile⁠

Full VUSB profile⁠