SPIP vs VTIP

SPIPBState Street SPDR Portfolio TIPS ETF

VTIPAVanguard Short-Term Inflation-Protected Securities ETF

In short

SPIP SPIP owns the whole U.S. TIPS curve in one wrapper: government bonds built to move with inflation, roughly 60 of them, for 0.12% a year. A 2007-vintage, no-gimmick way to rent the real-yield side of Treasuries.

VTIP Inflation protection without the long-bond whiplash. VTIP holds only Treasury TIPS maturing inside five years, so CPI does most of the driving and rate swings do less of it, for three basis points a year.

Stated mandate

SPIP The fund seeks to track the price and yield performance of the Bloomberg U.S. Government Inflation-Linked Bond Index before fees and expenses, providing exposure to U.S. Treasury inflation-protected securities.

VTIP Tracks a benchmark measuring the investment return of U.S. Treasury inflation-protected public obligations with remaining maturities under five years.

Why people hold it

• SPIP Sticks close to its benchmark, the Bloomberg U.S. Government Inflation-Linked Bond Index, and rates as one of the tighter index fits in its broad Treasury peer group.
• Full-curve exposure: short, intermediate and long inflation-protected Treasuries in one ticket, so you skip the maturity-picking.
• 0.12% a year lands right at the median fee for broad Treasury ETFs, on a billion-dollar-plus fund that sees steady everyday volume.
• Trading since 2007, giving it a long live record across both the dead-quiet inflation years and the loud ones.

• VTIP Three basis points a year, against a 0.12% median for Treasury bond ETFs in its group. Vanguard's at-cost setup shows up right in the fee line.vanguard.com
• TIPS principal ratchets with CPI, and the under-five-year maturity cap keeps duration short, so rate moves land lighter here than in full-curve TIPS funds like SCHP.vanguard.com
• Open since 2012 and now a multi-billion-dollar, actively traded fund that owns Treasury paper directly. Plain index rules, no swaps, no credit detours.

Worth knowing

• SPIP Cheaper versions of the same broad idea exist. VTP charges 0.05%, so SPIP's 0.12% is a real premium for inflation-linked Treasuries.
• Holding long-dated TIPS means real-rate moves push the price around. Inflation protection is not the same thing as price stability.
• Payouts are irregular by design, because inflation accruals on TIPS arrive unevenly. Not a metronome-steady income stream.

• VTIP Short maturities cut both ways: less sensitivity to rates, and less exposure to shifts in long-run inflation expectations than a full-maturity TIPS fund such as SCHP.
• Income rides on CPI accruals, so the quarterly payout moves around rather than arriving as a steady coupon.
• This is one narrow slice of one market, short US Treasury TIPS, not a diversified bond portfolio.

Full SPIP profile⁠

Full VTIP profile⁠