SGOV: The best way to get exposure to treasury bills?

[Electron]

I get that the price rises throughout the month because you're essentially buying the monthly dividend (someone who buys SGOV on the 25th has to pay more than someone who buys on the 5th because he holds it for fewer days but receives the same dividend). Does that mean a potential investor should be indifferent regarding the purchase date? For example, is there any advantage to waiting for the beginning of the month to buy cheaper shares, or does the wait for the dividend eliminate any advantage from doing so?

I don't believe there is any advantage in waiting in terms of investment return. However, note that selling shares with a variable NAV may involve a small capital gain or loss.

Tax reporting would include both dividends and capital gain/loss (Form 1099-DIV and Form 1099-B).

Here is a chart showing a one year time frame.

https://schrts.co/CRIrrThR

[Eno Deb]

Here is a chart showing the monthly rise in SGOV followed by the fund going ex-dividend.

https://schrts.co/HdtdwqTE

The fund may have an advantage over VUSXX for the state tax exemption this year but the tax reporting would be more complicated with the variable NAV.

I get that the price rises throughout the month because you're essentially buying the monthly dividend (someone who buys SGOV on the 25th has to pay more than someone who buys on the 5th because he holds it for fewer days but receives the same dividend). Does that mean a potential investor should be indifferent regarding the purchase date? For example, is there any advantage to waiting for the beginning of the month to buy cheaper shares, or does the wait for the dividend eliminate any advantage from doing so?

One difference could be state taxation. While the dividends are (mostly) exempt, capital gains are not in most states. But given how small these fluctuations are you'd have to invest a lot for it to make a significant difference.

[placeholder]

I get that the price rises throughout the month because you're essentially buying the monthly dividend (someone who buys SGOV on the 25th has to pay more than someone who buys on the 5th because he holds it for fewer days but receives the same dividend). Does that mean a potential investor should be indifferent regarding the purchase date? For example, is there any advantage to waiting for the beginning of the month to buy cheaper shares, or does the wait for the dividend eliminate any advantage from doing so?

If you don't want to or can't buy fractional shares then the share price might affect how much cash you invest at one time for example:

1. You want to invest about 10k without going over that amount then a high share price is better so if say the price is around 100.60 then 99 shares would invest about 9959.40 versus 9919.8 when the share price is near 100.20.

2. Conversely if you don't mind going over then the low share price buys 100 shares at 10020 versus 100060.

That's not terribly important in the grand scheme.

[Electron]

Here is an interesting chart showing how SGOV responded to the Fed rate hikes starting in March 2022.

The share price started the period just slightly over $100.00 per share.



https://schrts.co/igThrzXb

[Charles Joseph]

I'm not sure how I know the state of Connecticut will accept SGOV dividends as interest from treasury bills. Or if it will.

[Electron]

I'm not sure how I know the state of Connecticut will accept SGOV dividends as interest from treasury bills. Or if it will.

Here is some information posted earlier in this thread. iShares provides the required tax information.

viewtopic.php?p=7355464#p7355464

In 2022, 92.61% of income from SGOV was from U.S. Government obligations.

You will also want to review the requirements for your state.