TBIL Hits Three Bil: The US Treasury 3 Month Bill ETF (TBIL) Surpasses $3 Billion in Assets
- The US Treasury 3 Month Bill ETF (TBIL) has surpassed $3 billion in assets, contributing to the total $4.25 billion raised by F/m Investments' US Benchmark Series since August 2022.
- Investors are drawn to the US Benchmark Series for its 10 ETFs offering exposure to US Treasuries at various points on the yield curve, providing a balance of safety and yield.
- F/m's President emphasizes the growing demand for accessible short-term investments amidst the influx of new asset classes and cryptocurrencies in the market.
- The introduction of the US Credit Series aligns with F/m's goal of simplifying investment processes by tracking the industry's first investable index in investment grade credit.
- F/m's innovative exemptive application to the SEC seeks approval for mutual fund share classes within the US Benchmark Series, potentially broadening access to a wider range of investors.
- None.
Insights
The recent announcement by F/m Investments regarding the success of their US Benchmark Series, particularly the US Treasury 3 Month Bill ETF (TBIL), which has surpassed $3 billion in assets, is a strong indicator of investor sentiment and behavior. Amidst market volatility and the influx of novel asset classes, there is a clear trend towards the safety and predictability of US Treasury securities. The diversification of the US Benchmark Series across different maturities of the yield curve caters to a wide range of investment strategies, from short-term liquidity management to long-term fixed income allocation.
Moreover, the introduction of the US Credit Series ETFs, tracking the first investable index in investment grade credit, signifies an expansion of F/m's product offerings, aiming to provide investors with broader tools for portfolio construction. This could potentially disrupt the traditional mutual fund market, as it offers a level of precision and liquidity that is typically associated with ETFs.
The potential SEC approval for a mutual fund share class for the ETFs in the US Benchmark Series could democratize access to these investment vehicles, aligning with the ongoing trend of convergence between mutual funds and ETFs. This could open up opportunities for a segment of investors who are restricted to mutual fund investments due to regulatory or policy constraints.
The accumulation of over $4.25 billion in assets for the US Benchmark Series within 18 months of its inception reflects a strong market demand for these products. This is an important financial metric, as it demonstrates significant capital inflow into the series, which can be seen as a vote of confidence from the investment community. The growth of TBIL, in particular, suggests that investors are seeking haven in short-term securities amidst uncertain economic conditions, which may be indicative of a risk-averse stance in the current market environment.
From an investment perspective, the exemptive application filed with the SEC for offering a mutual fund share class is a strategic move that could potentially increase the liquidity and flexibility of the US Benchmark Series. If approved, this could lead to a reshaping of investor portfolios, as they could combine the benefits of mutual funds, such as familiarity and ease of use, with the advantages of ETFs, including intraday trading and typically lower fees.
The exemptive application filed by F/m Investments with the SEC is a noteworthy legal development within the ETF industry. If granted, this would set a precedent for ETFs to offer a mutual fund share class, potentially bridging the gap between two distinct types of investment products. The legal implications of such a decision by the SEC could lead to a significant shift in the regulatory landscape, influencing how investment products are structured and offered to different investor classes.
Understanding the legal nuances of this application is critical for stakeholders, as it could potentially alter the competitive dynamics within the investment fund industry. The ability to offer a mutual fund share class could provide ETFs with a competitive edge over traditional mutual funds, particularly in attracting a segment of the investor base that has been historically limited to mutual fund investments due to various constraints, including 401(k) plans and other retirement accounts.
F/m Investments’ US Benchmark Series raises
Each ETF in the US Benchmark Series holds the most current (“on the run[1]”) US Treasury security that corresponds to its tenor. The 10 ETFs in the Series are:
- The US Treasury 3 Month Bill ETF (TBIL)
- The US Treasury 6 Month Bill ETF (XBIL)
- The US Treasury 12 Month Bill ETF (OBIL)
- The US Treasury 2 Year Note ETF (UTWO)
- The US Treasury 3 Year Note ETF (UTRE)
- The US Treasury 5 Year Note ETF (UFIV)
- The US Treasury 7 Year Note ETF (USVN)
- The US Treasury 10 Year Note ETF (UTEN)
- The US Treasury 20 Year Bond ETF (UTWY)
- The US Treasury 30 Year Bond ETF (UTHY)
The Series has raised more than
“TBIL’s continued growth highlights investors’ appetite for easy access to safety and yield at the short end of the curve,” said Alexander Morris, F/m’s President, and CIO. “In a market inundated recently by novel asset classes and even cryptocurrencies, the US Benchmark Series ETFs – both short and longer durations – are attracting assets from investors seeking duration exposure with the clarity and precision that these ETFs enable.”
While TBIL remains the most recognized of F/m’s products, it’s not their most recent innovation. Consistent with F/m’s mission to provide a set of tools that investors can use to build portfolios with precision and efficiency, F/m in January launched the US Credit Series, a suite of ETFs that track the industry’s first investable index in investment grade credit.
“We launched TBIL and the US Benchmark Series to bring efficiency and simplicity to US Treasury investing, but our goal was always larger,” said Pete Baden, senior portfolio manager and co-creator of the US Benchmark Series. “It’s our mission to build institutional quality, precise, diversified portfolios with the ease and efficiency of ETFs.”
As part of F/m’s mission to expand access for investors, they recently filed a novel exemptive application with the
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[1] This periodic transition to the most-recently auctioned Treasury bill, note, or bond of a stated maturity, which is referred to as the “on-the-run” or “OTR” security of that maturity, occurs on one day. An OTR security is the most recently issued of a periodically issued security (as opposed to an off-the-run security, which is a security that has been issued before the most recent issue and is still outstanding). |
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About US Treasury 3 Month Bill ETF
The investment objective of the US Treasury 3 Month Bill ETF is to seek investment results that correspond (before fees and expenses) generally to the price and yield performance of the ICE BofA US 3-Month Treasury Bill Index (G0O1)
About The US Benchmark Series
The US Benchmark Series allows investors of all sizes to own each of the “Benchmark” US Treasuries in a single-security ETF. Each ETF holds the most current (“on the run”) US Treasury security that corresponds to its stated tenor. For more information, please visit www.ustreasuryetf.com.
About F/m Investments
F/m Investments is a
Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please call (888)123-4589 or visit our website at www.fminvest.com. Read the prospectus or summary prospectus carefully before investing.
Disclosures:
Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, please call 1-800-617-0004 or visit our website at www.ustreasuryetf.com. Read the prospectus or summary prospectus carefully before investing.
As with all ETFs, Shares may be bought and sold in the secondary market at market prices. Interest rate risk is the risk of losses attributable to changes in interest rates. In general, if prevailing interest rates rise, the values of debt instruments tend to fall, and if interest rates fall, the values of debt instruments tend to rise.
Fund Risks: The UST 3 Month Bill Fund may be susceptible to an increased risk of loss, including losses due to adverse events that affect the UST 3 Month Bill Fund’s investments more than the market as a whole, to the extent that the UST 3 Month Bill Fund’s investments are concentrated in a particular issue, issuer or issuers, country, market segment, or asset class. While
ICE BofA US 3-Month Treasury Bill Index is comprised of a single issue purchased at the beginning of the month and held for a full month. At the end of the month that issue is sold and rolled into a newly selected issue. The issue selected at each month-end rebalancing is the outstanding Treasury Bill that matures closest to, but not beyond, three months from the rebalancing date. To qualify for selection, an issue must have settled on or before the month-end rebalancing date.
Investments involve risk. Principal loss is possible.
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Tucker Slosburg
Lyceus Group
206.635.4196
fmpr@lyceusgroup.com
Source: F/m Investments LLC
FAQ
How much has F/m Investments' US Benchmark Series raised since August 2022?
What is the asset threshold crossed by The US Treasury 3 Month Bill ETF (TBIL)?
How many ETFs are included in the US Benchmark Series?
What was F/m's recent innovation besides TBIL?
What is F/m's mission regarding portfolio building?
What unique application did F/m file with the SEC recently?
