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GOVZ is passively managed to capture the long end of the US Treasury curve. As such investor should expect the performance to fluctuate with changes in interest rates. The fund holds a small portfolio of Treasury STRIPS with at least 25 years to maturity. STRIPS are securities that promise single payment upon maturity without any semi-annual coupons. The types of securities are sold at a discount to face value but mature at par. The underlying index is weights securities by their market value and is rebalanced quarterly.
Is GOVZ's expense ratio expensive, average, or a steal for its category?
Pro reveals the verdict on a 5-tier spectrum calibrated against ICI 2025 industry averages, with strategy-aware bands so the comparison is meaningful.
After accurately predicting the sharp drop in long bonds, the author is turning neutral/constructive, believing most of the price decline is already in the past. Long bonds are deeply oversold (GOVZ RSI touched 25 before rising to 37), and 30-year yields near 5.6% are approaching a major, multi-decade resistance zone of 6%. The U.S. Treasury is expected to reduce auction sizes for long-dated bonds (like 20- and 30-year debt) in favor of shorter T-bills to keep government funding costs manageable.
iShares 25+ Year Treasury STRIPS Bond ETF faces significant risks from its extreme duration and sensitivity to long-term rates. GOVZ's -0.26% total return over the past year underscores that SEC yield is misleading amid rising rate volatility and macro headwinds. A hawkish Fed stance and resurgent inflation expectations threaten further losses for GOVZ, as even modest rate increases could drive sharp drawdowns.
The iShares 25+ Year Treasury STRIPS Bond ETF has posted a modest decline so far in 2026, impacted by a rise in long-term treasury yields. I expect the Fed to resume rate cuts in H2 2027 and into 2028, allowing for a circa 0.5-0.6% decline in risk-free rates across the yield curve. This in turn should be beneficial for GOVZ thanks to the ETF's high sensitivity to changes in long-term interest rates.
The iShares 25+ Year Treasury STRIPS Bond ETF offers the highest yield for Treasury bonds. That comes with a high amount of duration risk. If that is acceptable, then we will show you where you can get 25 basis points of extra yield.
The iShares 25+ Year Treasury STRIPS Bond ETF (GOVZ) offers ultra-long duration exposure, making it highly sensitive to changes in long-term rates. GOVZ faces significant risks from a steepening yield curve, or from long-term inflationary effects independent of impacts from immediate cuts. If rates fall, that is inflationary and could reflect institutional erosion to political pressures. If they don't fall it will pressure the fiscal outlook given maturity walls.