What are floating rate notes and how do they differ from Treasury bonds?

Floating rate notes are debt instruments whose interest payments adjust periodically based on a reference rate, often offering a credit spread over Treasury yields. Treasury floating rate bonds are issued by the US government, generally carrying lower credit risk but typically lower yields than corporate notes. FLOT invests in floating rate notes, while TFLO focuses on US Treasury floating rate bonds. These differing asset classes influence the yield potential and risk profile of each fund, though exact holdings details are not available.

How do ETF distributions work for income-focused investors?

ETFs like FLOT and TFLO generally distribute income earned from underlying securities, such as interest payments, on a regular schedule. The dividend yield shown represents the annualised income relative to the fund's price, providing a sense of income potential. However, these distributions can fluctuate as interest rates change and income from the underlying bonds varies. For floating rate funds, yields tend to adjust with short-term interest rates, meaning current yields may not remain static over time for either fund.

What does 'Ultrashort Bond' categorisation mean for these ETFs?

Ultrashort bond ETFs typically invest in fixed-income securities with maturities of one year or less, aiming to minimise interest rate sensitivity. Both FLOT and TFLO fall into this category, suggesting a focus on short-term liquidity and reduced price volatility compared to longer-duration bond funds. This categorisation generally appeals to investors seeking a cash-equivalent-like asset with potential for slightly higher income than standard cash accounts. However, the specific index methodology for each fund is not available, limiting detailed analysis.

Which fund offers a higher current dividend yield, and why might that differ?

Based on current data, FLOT provides a dividend yield of 4.34%, while TFLO yields 3.74%. FLOT's higher yield typically reflects the additional credit spread earned by investing in corporate floating rate notes compared to the safer, government-issued Treasury floating rate bonds held by TFLO. Investors should understand that higher yields often come with incrementally higher credit risk, although both funds are designed for short-term exposure. Top holdings data for both is not available, so specific issuer risk analysis is limited.

Do FLOT and TFLO hold the same assets?

No, the two funds do not share any holdings in their top 10 positions, indicating distinct portfolio constructions. FLOT focuses on the broader market of floating rate notes, which often includes corporate issuers, while TFLO specifically targets US Treasury floating rate bonds. This lack of overlap means their performance and risk profiles are driven by different segments of the short-term debt market. However, detailed top holdings and sector weights for both are currently not available for review.

How do the expense ratios of FLOT and TFLO compare?

Both FLOT and TFLO maintain an identical expense ratio of 0.15%. This low fee structure is common for large, liquid ETFs with significant assets under management. Since the fee is exactly the same, there is no cost-based advantage or disadvantage between the two funds currently. Investors comparing these options should therefore focus on the differences in underlying assets and the resulting yield variations rather than fee levels.

Which ETF is more susceptible to changes in short-term interest rates?

Both funds are designed to adjust their yields based on short-term interest rate movements, as they hold floating rate instruments. When short-term rates rise, the income generated by the securities in both FLOT and TFLO generally increases, and conversely, it decreases when rates fall. The primary difference lies in the credit component; while the base rate adjustment is similar, the corporate spread component in FLOT may react differently to credit market stress compared to the purely government-based exposure of TFLO.

How significant are the differences in asset size between the funds?

FLOT manages net assets of $10.9 billion, whereas TFLO manages $6.9 billion. A larger asset base can support greater liquidity and potentially tighter bid-ask spreads during trading, which is beneficial for active investors. Both funds are substantial in size, suggesting they are well-established market participants. However, neither fund has publicly available top holdings or sector weightings, so the internal concentration of assets remains less transparent to the general observer.

What are the inception dates for these ETFs?

FLOT was launched on 14 June 2011, providing it with a longer operating history compared to TFLO, which was launched on 3 February 2014. The longer track record of FLOT allows investors to observe its performance over a wider range of historical interest rate environments. While both are now mature funds, the difference in age may provide slightly more historical data for FLOT when analysing long-term behaviour in various market conditions.

What information is unavailable for these funds in current data feeds?

For both FLOT and TFLO, the specific index tracked is listed as not available. Furthermore, data regarding their top holdings and sector weights is currently not available. This lack of transparency prevents detailed analysis of credit concentration, industry exposure, and the exact methodology behind the benchmark indices. Investors looking to deeply understand the specific risks associated with individual holdings or sector bets will find current public data incomplete for both funds.

FLOT vs TFLO

Two funds, one decision: we compare cost, performance and what each ETF actually holds in September 2026.

Compare iShares Floating Rate Note ETF (FLOT) and iShares Treasury Floating Rate Bond ETF (TFLO). This page details fees, holdings, dividends, and how each tracks its market. Both hold $0.15 expense ratios and distinct assets. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

FLOT

Metric

TFLO

0.15%

Expense Ratio

0.15%

4.34%

Dividend Yield

3.74%

$10.93B

Net Assets

$6.90B

556

Holdings

Jun 14, 2011

Inception Date

Feb 3, 2014

–

Index Tracked

–

Ultrashort Bond

Fund Category

Ultrashort Bond

Both funds charge the same annual fee.

Shared Top Holdings

These funds do not share any of their top holdings.

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FLOT vs FLTR

Compare FLOT and FLTR ETFs. Review expense ratios (0.15% vs 0.14%), dividend yields (4.34% vs 4.49%), assets and tracking details for neutral insight.

SGOV vs TFLO

Compare SGOV and TFLO fees, dividends and tracking. SGOV costs 0.09%; TFLO costs 0.15%. Holdings data not available for either fund in this review.

Investment Analysis

FLOT

Pros

Offers a higher dividend yield of 4.34 percent compared to similar treasury-based funds.
Boasts a larger net asset base of 10.9 billion dollars potentially aiding liquidity.
Has a long history since its 2011 inception providing a track record.

Considerations

The specific index tracked by the fund is currently not available for review.
Top holdings data is not available limiting visibility into specific credit exposures.
Sector weights are not available preventing analysis of industry concentration risks.

TFLO

Pros

Exposure is typically to US Treasury securities which generally carry low credit risk.
Has a net asset base of 6.9 billion dollars indicating reasonable scale.
The fund maintains an expense ratio of 0.15 percent which is low.

Considerations

Its dividend yield of 3.74 percent is lower than comparable non-treasury options.
The specific index methodology is not available which limits transparency understanding.
Top holdings and sector weight details are not available for assessment.

About FLOT and TFLO

FLOT (FLOT)

The iShares Floating Rate Note ETF (FLOT) is an exchange-traded fund designed to provide investors with exposure to investment-grade floating rate notes. These are bonds whose interest payments adjust periodically based on prevailing short-term interest rates, often linked to benchmarks like the London Interbank Offered Rate (LIBOR) or the Secured Overnight Financing Rate (SOFR). This structure can potentially help mitigate interest rate risk compared to fixed-rate bonds, as coupon payments may rise when rates increase. With a low expense ratio of 0.15% and substantial net assets of approximately USD 10.93 billion, the fund offers liquidity and cost efficiency. It holds 556 different securities, providing diversification across the floating rate note market. Launched in 2011, it targets investors seeking income in a potentially rising rate environment. However, as with any investment, capital values can fluctuate, and returns are not guaranteed. Investors should consider their risk tolerance and investment objectives before adding such funds to their portfolio.

TFLO (TFLO)

The iShares Treasury Floating Rate Bond ETF (TFLO) is an exchange-traded fund designed to provide exposure to U.S. Treasury floating rate notes. As an ultrashort bond category fund, it seeks to track the performance of an index composed of Treasury securities with interest rates that reset periodically, typically every three months. With a modest expense ratio of 0.15%, the fund holds a concentrated portfolio of approximately 10 holdings, reflecting the specific nature of its underlying securities. It reported net assets of USD 6.90 billion and a dividend yield of 3.74% as of recent data. Investors might consider this fund for its potential to offer income that adjusts with prevailing short-term interest rates, potentially providing some protection against rate volatility compared to fixed-rate bonds. However, remember that capital values and income distributions can fluctuate, and returns are not guaranteed. It is generally suited for those seeking short-term liquidity and income exposure within the government bond market, subject to appropriate risk tolerance and suitability assessment.

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FLOT vs TFLO

Fund Snapshot

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FLOT vs FLTR

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Investment Analysis

FLOT

Pros

Considerations

TFLO

Pros

Considerations

About FLOT and TFLO

Buy FLOT or TFLO in Nemo

Zero Commission

Trusted & Regulated

6% Interest on Cash

Frequently asked questions

What are floating rate notes and how do they differ from Treasury bonds?

How do ETF distributions work for income-focused investors?

What does 'Ultrashort Bond' categorisation mean for these ETFs?

Which fund offers a higher current dividend yield, and why might that differ?

Do FLOT and TFLO hold the same assets?

How do the expense ratios of FLOT and TFLO compare?

Which ETF is more susceptible to changes in short-term interest rates?

How significant are the differences in asset size between the funds?

What are the inception dates for these ETFs?

What information is unavailable for these funds in current data feeds?

Fund Snapshot

About FLOT and TFLO

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FLOT vs FLTR

SGOV vs TFLO