The iShares TIPS Bond ETF (TIP) is designed to provide investors with exposure to U.S. Treasury Inflation-Protected Securities (TIPS), aiming to protect against inflation while offering the stability of government-backed bonds.

Fund Overview

  • Objective: The ETF seeks to replicate the performance of the ICE U.S. Treasury Inflation Linked Bond Index, which includes TIPS with at least one year remaining to maturity.

  • Inception Date: December 4, 2003.

  • Expense Ratio: 0.19%.

Performance and Holdings

As of February 7, 2025, TIP is trading at $108.50, reflecting a slight decrease of 0.22% from the previous day. Over the past year, the ETF has experienced a 1.54% return. The fund manages assets totaling approximately $13.82 billion and holds 52 different securities.

The ETF’s holdings are exclusively U.S. Treasury Inflation-Protected Securities, with maturities spanning various durations. This diversification across maturities helps balance interest rate risk and inflation protection.

Dividend Information

TIP offers a dividend yield of 2.48%, with a trailing twelve-month dividend of $2.69. The most recent ex-dividend date was December 18, 2024.

Market Considerations

Investors should be aware that while TIP provides a hedge against inflation, its performance is influenced by changes in real interest rates. In environments where real yields rise, the fund’s price may decline, and vice versa. Additionally, the ETF’s sensitivity to interest rate movements means that significant fluctuations in rates can impact its net asset value.

Conclusion

The iShares TIPS Bond ETF offers investors a means to protect their portfolios against inflation through exposure to U.S. Treasury Inflation-Protected Securities. With its diversified holdings across various maturities and a reasonable expense ratio, TIP is a viable option for those seeking inflation protection coupled with the security of government-backed bonds.