SHY vs BIL
iShares 1-3 Year Treasury Bond ETF vs SPDR Bloomberg 1-3 Month T-Bill ETF
Bottom line: BIL holds 1-3 month T-bills with almost no rate risk; SHY holds 1-3 year Treasuries with more yield potential but real price sensitivity.
At a Glance
| SHY | BIL | |
|---|---|---|
| Issuer | BlackRock | State Street |
| Index Tracked | ICE US Treasury 1-3 Year Bond Index | ICE Short Treasury Bond Index |
| Expense Ratio | 0.15% | 0.1354% |
| Data Start Date | 1991-11-01 | 2007-06-01 |
Price History
Months versus years
BIL holds Treasury bills maturing in 1 to 3 months — effectively cash. SHY holds Treasury notes maturing in 1 to 3 years, so it carries meaningfully more duration and behaves like a short bond fund rather than a cash equivalent.
That distinction matters: BIL barely moves in price, while SHY can post small gains or losses as rates change.
Rate sensitivity in practice
In 2022, SHY declined modestly as rates rose, while BIL was essentially flat and simply captured rising bill yields. When rates fall, SHY can appreciate a bit while BIL just tracks the declining short rate.
SHY therefore offers more return potential and more risk than BIL. It is a short-term bond holding, not a pure cash substitute.
Choosing by purpose
For an emergency fund or truly stable cash, BIL is the better fit. For the short-bond sleeve of a strategy — such as the short-term Treasury portion of the Golden Butterfly or Larry Portfolio — SHY's 1-3 year duration is the intended exposure.
Match the tool to the job: BIL for stability, SHY for a modest step up the curve.
Frequently Asked Questions
Is SHY a cash equivalent like BIL?
Not quite. BIL holds 1-3 month T-bills and behaves like cash with a very stable price. SHY holds 1-3 year Treasuries, so it has more duration and its price can rise or fall with interest rates. SHY is a short bond fund, not a pure cash substitute.
Which yields more, SHY or BIL?
It depends on the yield curve. When the curve is upward-sloping, SHY's longer 1-3 year maturities typically yield more. When the curve is inverted, short T-bills in BIL can yield as much or more.
Hypothetical historical performance based on backtested data. Past performance does not guarantee future results. This site is for educational purposes only and does not constitute investment advice. Full disclaimer