Best Places For Cash In Uncertain Times: SGOV, T-Bills, BIL, VBIL Or Money Market Funds (VUSXX)?

What is SGOV and what other ultra-short treasury funds are out there? SGOV is a zero to three-month treasury bond ETF launched by BlackRock as part of its well-known iShares family on May 26, 2020, more than six years ago.

All numbers and data in this discussion are as of the time of this taping on October 8, 2026, unless otherwise noted.

SGOV has $114.4 billion in assets under management at the current time and charges an expense ratio of nine basis points, equivalent to nine cents per $100 invested per year.

SGOV tracks the ICE zero to three month U.S. Treasury Securities Index, which makes it an ultra short bond fund in industry speak.

SGOV shows 24 positions in its portfolio, 22 of which are, as expected, T-bills with maturities of less than three months.

The two exceptions are smaller money market fund holding and a cash position that can fluctuate from day to day.

Taken together, these positions give the fund a weighted average maturity of 0.12 years, or a bit more than one month.

SGOV's historical performance, not surprisingly, has tracked the overall trajectory of Treasuries, going from a modest total return of 0.04% in 2021 to its best full-year performance so far of 5.27% in 2024.

The year-to-date numbers for 2026 seem to point at a lower total return of 2.8%, but we'll see how this turns out at the end of the year, given the ongoing uncertainty and volatility around rates.

And except for 2025, SGOV has outperformed the benchmark index every year, and sometimes substantially so.

It looks a bit more mixed when compared to the category line here.

But personally, I'm not so sure this is really that relevant because this Morningstar ultra-short bond fund category also includes funds that invest in longer-dated treasuries as well as in corporate bonds and other securities that may have a different risk-return profile than treasuries proper.

So not a bad picture overall for SGOV when we look at the total return history.

Now, let's take a quick look at the distribution yield next.

How much cash flow the fund generated for its investors.

This may be less relevant if you just want to park some funds in SGOV temporarily for the short term, but would be important if you consider making it part of your revenue stream planning.

SGOV pays its dividend in 12 monthly installments, and it has fluctuated with Treasury yields over time, from a low of 3.13 cents per share in 2021, when yields for short-term Treasuries were near zero, to a high of $5.1151 per share in 2021. in 2024, when interest rates were high to fight the post-COVID inflation.

For 2026, SGOV has paid $2.682 per share so far, including the October distribution, which would give us about $3.22 per share for the year if we simply extrapolate, so a bit lower than last year if it stays at these levels.

Let's see what these dividend numbers translate into in terms of distribution yields now.

The 30-day SEC yield stood at 3.71% at the time of this taping, and the 12-month trailing yield, or TTM, at 3.65%.

Remember, both distribution yields measure the actual cash payouts as a percentage of the share price at the end of the last observation period, with the difference that the 30-day SEC yield annualizes the last 30 days, while the TTM takes the actual distributions over the past 12 months.

So let's compare those SGOV numbers to the yield on a one-month T-bill at the current time, which is close enough to the weighted average maturity of SGOV as well as its monthly dividend frequency.

So an investment in one-month T-bills would yield 4.14% at the moment, which is about 43 basis points more than SGOV's 30-day yield, which is quite significant, I have to say.

Now, A small part of that difference can be explained by the nine basis points and expenses that SGOV charges its investors.

But the rest comes from the steep increase in the yields that the one-month T-bill has seen over the past few weeks.