Summary
- The real yield to maturity on the STIP is a respectable 1.06%. This yield is based on the current nominal yield minus average inflation expectations over the next 2.6 years.
- Short-term inflation expectations have fallen too fast recently and there is potential for them to rise if the Fed pares back its hiking cycle, which would benefit the STIP.
- It would likely take another financial crisis to cause any meaningful weakness in the STIP, in which case, the ETF would almost certainly outperform most other assets.
For further details see:
STIP: 3 Reasons To Lock In These Real Yields