Best ETFs For Trading: TIPS, Junk And Munis
These 15 funds are the cheapest in their categories for short-term speculations.
Owning a bond fund is one way to bet on a decline in interest rates. The table ranks the cheapest exchange-traded funds for three-month holding costs on a $10,000 investment.
|3-month Holding Cost*|
|STIP||iShares 0-5 Year TIPS Bond||$2.75||A|
|VTIP||Vanguard Short-Term Infl-Prot Secs||3.59||A|
|SCHP||Schwab US TIPS||3.60||A|
|TIP||iShares TIPS Bond||5.97||A+|
|IPE||SPDR Blmbg Barclays TIPS||7.01||B|
|TDTT||FlexShares iBoxx 3Yr Target Dur TIPS||9.79||B|
|HYGH||iShares Interest Rate Hedged High Yield Bond||3.65||B|
|HYLB||Xtrackers USD High Yield Corp Bd||6.53||A|
|SHYG||iShares 0-5 Year High Yield Corp Bd||7.20||A|
|HYG||iShares iBoxx $ High Yield Corporate Bond||9.94||A+|
|MUB||iShares National Muni Bond||3.17||A|
|VTEB||Vanguard Tax-Exempt Bond||4.28||A|
|SUB||iShares Short-Term National Muni Bd||6.37||B|
|SHM||SPDR Nuveen Blmbg Barclays ST MunBd||7.72||A|
|TFI||SPDR Nuveen Blmbg Barclays Muni Bd||9.00||A|
*Cost of a $10,000 position held for three months. Reflects bid/ask spread, expense ratio and cost offset from securities lending.
Data sources: Morningstar, Bloomberg, fund distributors
Bid/ask spreads figure heavily, and expense ratios not so heavily, in the cost calculation for speculative plays. For long-term investing the reverse is true, and different ETFs rise to the top in cost efficiency. For long-term cost rankings see Best ETFs: TIPS, Best ETFs: Junk Bonds, and Best ETFs: Tax-Exempt Bonds.
For links to the three-month cost rankings in other categories, see Best ETFs for Trading.