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Stefan Schumacher's avatar

What are the best ETF ideas for a “higher for longer” environment?

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ETF Focus's avatar

Honestly, T-bills aren't a bad idea in my opinion. If you can get a 5% risk-free yield, why not? BIL, SGOV, SHV, USFR

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Dan's avatar

What do you think of MTBA yielding 6%? Is 4 year duration too much given its holding Fannie Mae TBAs? How about STIP (0-5 year TIPs)? I have too much USFR and am extremely underweight US growth equity.

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ETF Focus's avatar

Personally, I don't want anything to do with MBS right now. I think STIP is much more attractive since I think inflation is still heading higher.

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ETF Focus's avatar

I mean, it could I suppose. I'm not terribly familiar with it, but at first glance it seems like an overly complicated way of doing essentially what a Treasury bill does.

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Stefan Schumacher's avatar

The reason it’s interesting, though, is it doesn’t make distributions so you’re not getting taxed until you decide to sell.

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ETF Focus's avatar

Interesting. I imagine that could be a differentiator for someone managing their tax situation.

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