Understanding the F/M US Treasury 3 Month Bill ETF (TBIL)

What this ETF is trying to do

The TBIL ETF is designed to track U.S. Treasury 3-month bills. These are short-term debt tools issued by the United States government.

What the numbers show

When looking at an ETF, it is important to know the difference between "price return" and "total return."

• Price Return: This only tracks how much the share price itself has changed.

• Total Return: This includes both the change in share price *and* the cash distributions (dividends) paid out to investors.

For TBIL, the numbers show:

• Year-to-Date (YTD): The price return is 0.00%, but the total return is approximately 2.75%.

• One Year: The price return was about 2.01%, while the total return was approximately 3.72%.

• Three Years: The price return was about -6.01%, but the total return was much higher at approximately 13.94%.

To give you an idea of price movement, the current price is $49.88. The estimated price from roughly one year ago was approximately $49.87.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is approximately 3.64%. This means the amount of cash paid out is about 3.64% relative to the ETF's price. These payments usually happen monthly, with 12 payouts recorded over the last year. It is important to remember that a high yield does not guarantee that your original investment will stay the same value.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). Some investors worry about this because if the value of the underlying assets drops, it can affect the ETF.

For TBIL, the erosion-risk score is 94, which is labeled as "Stable / sideways." The erosion severity is rated as "good," and there is no severe erosion-risk flag present.

Pros

• The ETF has a history of positive total returns over the one-year and three-year periods.

• It provides regular monthly income through distributions.

• The erosion-risk measurements suggest the fund is currently stable.

Cons

• The three-year price return was negative (-6.01%), meaning the share price itself dropped during that time, even though the total return was positive.

• There is no data provided regarding specific top holdings or the number of stocks held in this fund.

Beginner takeaway

When looking at TBIL, pay close attention to the difference between price return and total return. While the share price might stay flat or even go down slightly, the total return can be higher because of the cash distributions paid out to investors. Always remember that distributions provide income, but they are separate from the movement of the share price itself.