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SGOV vs BIL vs TFLO: Treasury ETFs Compared

A detailed comparison of SGOV, BIL, and TFLO, including holdings, duration, floating-rate risk, yields, expenses, taxes, and when each Treasury ETF makes sense.

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SGOV, BIL, and TFLO are exchange-traded funds used by investors who want Treasury-focused cash exposure. They are not identical. SGOV and BIL focus on very short Treasury bills. TFLO holds Treasury floating-rate notes, which reset with short-term rates.

All three can be useful, but the best choice depends on whether you want the shortest bill exposure, a large established T-bill ETF, or floating-rate Treasury exposure.

For direct Treasury buying, read T-Bill Ladder in TreasuryDirect 2026. For bank alternatives, see Treasury Bills vs CDs vs High-Yield Savings in 2026.

Quick Comparison

ETF Full name Main exposure Typical role
SGOV iShares 0-3 Month Treasury Bond ETF 0-3 month U.S. Treasuries Cash-like Treasury ETF
BIL SPDR Bloomberg 1-3 Month T-Bill ETF 1-3 month Treasury bills Cash-like Treasury ETF
TFLO iShares Treasury Floating Rate Bond ETF Treasury floating-rate notes Floating-rate Treasury exposure

Check current SEC yield, expense ratio, holdings, and fee waivers on the issuer pages before buying. Yields and expenses can change.

SGOV

SGOV is designed to hold very short U.S. Treasury securities. Its short maturity profile makes it relatively stable compared with longer-duration bond funds.

Potential advantages:

  • very short Treasury exposure
  • simple cash-like role
  • state-tax-efficient Treasury income
  • easy ETF trading

Potential drawbacks:

  • not FDIC insured
  • share price can still move slightly
  • brokerage bid-ask spreads matter
  • yield falls when Treasury bill yields fall

SGOV is often used as a brokerage cash substitute, but it is still an ETF.

BIL

BIL is another short Treasury bill ETF, with exposure focused on 1-3 month T-bills. It is one of the older and well-known products in this category.

Potential advantages:

  • simple T-bill exposure
  • high liquidity in many market conditions
  • short duration
  • Treasury income treatment

Potential drawbacks:

  • expense ratio can be higher than some newer competitors
  • yield changes as bills mature and are replaced
  • not a bank account

BIL may appeal to investors who value scale and trading liquidity.

TFLO

TFLO is different because it holds Treasury floating-rate notes rather than only Treasury bills. Floating-rate notes reset their coupons based on short-term Treasury bill rates plus a spread set at auction.

Potential advantages:

  • Treasury credit quality
  • coupon resets with short-term rates
  • low duration compared with fixed-rate intermediate bonds
  • can perform well when short rates remain high

Potential drawbacks:

  • not the same as a T-bill fund
  • income can fall if short-term rates fall
  • floating-rate note mechanics are less intuitive
  • ETF price can still move

TFLO can be useful for investors who want Treasury exposure that adjusts with short-term rates, but it is not a direct substitute for a one-month T-bill.

Taxes

Income from Treasury securities is generally subject to federal income tax and exempt from state and local income tax. Treasury ETFs may pass through a portion of income that qualifies for state-tax exemption, but the exact percentage can depend on fund holdings and annual tax reporting.

Investors in high-tax states should review the fund’s annual tax supplement.

ETF vs TreasuryDirect

Treasury ETFs are more convenient than TreasuryDirect for many investors:

  • intraday buying and selling
  • easy brokerage statements
  • no auction scheduling
  • automatic reinvestment options at the brokerage

But ETFs have:

  • expense ratios
  • bid-ask spreads
  • small market price fluctuations
  • no FDIC insurance
  • possible premium/discount to net asset value

If you know the exact date you need cash, a direct T-bill may match the liability better. If you want flexible brokerage cash, an ETF may be easier.

Which One Should You Choose?

Choose SGOV if you want simple, very short Treasury exposure and current costs/yield look competitive.

Choose BIL if you want an established 1-3 month T-bill ETF and value trading liquidity.

Choose TFLO if you specifically want Treasury floating-rate notes and understand that it is not just a T-bill ladder in ETF form.

Bottom Line

SGOV and BIL are closest to Treasury bill ETF cash substitutes. TFLO is a Treasury floating-rate note ETF. All three can be useful, but investors should compare current yield, expense ratio, holdings, tax reporting, and whether a direct T-bill ladder would be a better fit.

Sources

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