iShares TIPS Bond ETF
TIP BondUpdated: Jul 5, 2026, 21:17 UTC
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About This ETF
The iShares TIPS Bond ETF (TIP) is a Bond ETF with an expense ratio (TER) of 0.18% and $15.1B in assets under management. The ETF currently yields 2.81% in dividends. Year-to-date, TIP has returned +0.07%.
The index tracks the performance of inflation-protected public obligations of the U.S. Treasury, commonly known as “TIPS,” that have a remaining maturity of more than one year. The fund will invest at least 80% of its assets in the component securities of the index, and it will invest at least 90% of its assets in U.S. Treasury securities that BFA believes will help the fund track the index.
FAQ — TIP
What is the TER of TIP (iShares TIPS Bond ETF)?
TIP has a Total Expense Ratio (TER) of 0.18 % per year. That sits above the bond category median (0.15 % across 8 peer ETFs). The TER is deducted directly from the fund and lowers your effective return.
What return has TIP delivered?
Performance for TIP: YTD: +0.07 % · 3-year p.a.: +3.80 % · 5-year p.a.: +0.72 %. Over 5 years, TIP outperforms the bond category median of +0.03 % by +0.69 pp. Past performance is no guarantee of future returns.
Does TIP pay dividends?
TIP has a current dividend yield of 2.81 %. Distributing ETFs pay this out in cash; accumulating versions reinvest it inside the fund. Check the share class on your broker before buying.
Where can I buy or set up a savings plan for TIP?
TIP is available at most major brokers. For a free monthly savings plan from €1, look at Trade Republic, Scalable Capital or Flatex. The broker comparison on this site shows fees, free-savings-plan ETFs and execution exchanges side by side.
What the iShares TIPS Bond ETF Is
The iShares TIPS Bond ETF (TIP) holds U.S. Treasury Inflation-Protected Securities with more than one year to maturity. Unlike nominal bonds, the principal of these securities adjusts with the U.S. Consumer Price Index, so both coupons and the final repayment rise with inflation. With roughly $14.8B in assets and an expense ratio of 0.18%, the fund is a core building block for investors who want to shield their portfolios from the erosion of purchasing power.
Performance in Context
As a pure bond ETF, TIP does not aim for equity-style returns but for a real yield above inflation. It has returned 1.71% year to date, 3.90% annualized over three years, and 1.02% annualized over five years, with a current distribution yield of 2.77%. The main drivers are real yields in the U.S. bond market and realized inflation: when inflation rises, the adjusted principal benefits; when real rates rise, prices fall through duration. The softer five-year figure reflects the rate-hiking cycle, while the stronger three-year number captures the period of elevated inflation.
Risk Profile
Despite top-tier credit quality (U.S. government debt), TIP is not risk-free. The key risks are:
- Interest-rate risk: When real yields rise, prices fall because of the fund's intermediate-to-long duration.
- Deflation risk: Falling prices reduce the adjusted principal, undermining the inflation hedge.
- Currency risk: The fund is denominated in U.S. dollars. For euro-area investors, a weaker dollar can shrink returns or wipe out gains entirely.
- Real-rate risk: TIPS protect against inflation, not against rising real yields.
Who It Suits
TIP fits investors with an intermediate-to-long horizon who seek real capital preservation and want a deliberate hedge against inflation. It can also serve as a defensive diversifier alongside equities and nominal bonds. The fund is less suitable for investors chasing high growth returns, those with a very short horizon, or anyone unwilling to bear U.S. dollar risk. Investors who expect inflation to stay persistently low often earn a higher running yield from nominal Treasuries. This is not investment advice.
How It Compares with Other Bond ETFs
Within the bond universe, TIP sits among several alternatives:
- iShares Core U.S. Aggregate Bond (AGG) and Vanguard Total Bond Market (BND): broad nominal U.S. bonds with no explicit inflation protection.
- iShares 1-3 Year Treasury (SHY): short duration and lower rate risk, but no inflation hedge.
- iShares 20+ Year Treasury (TLT): long duration and far greater interest-rate sensitivity.
TIP stands apart through its built-in inflation protection, making it especially useful when real rather than nominal preservation is the priority.
Where can I buy TIP?
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