XTWO: Interesting Idea That Doesn't Work For Me

  • XTWO is a well-constructed, low-cost ETF tracking 2-year US Treasuries, but its yield is less attractive than alternatives. Despite taking more interest rate risk with XTWO, investors are not compensated with higher yield compared to floating rate Treasury ETFs like USFR. Current market conditions make floating rate Treasury ETFs more appealing, offering higher yields with lower risk than XTWO.