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Is Invesco Equal Weight 0-30 Year Treasury ETF (GOVI) a Strong ETF Right Now?

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The Invesco Equal Weight 0-30 Year Treasury ETF (GOVI - Free Report) made its debut on 10/11/2007, and is a smart beta exchange traded fund that provides broad exposure to the Government Bond ETFs category of the market.

What Are Smart Beta ETFs?

The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.

A good option for investors who believe in market efficiency, market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns.

There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.

Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.

The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.

Fund Sponsor & Index

Because the fund has amassed over $740.30 million, this makes it one of the average sized ETFs in the Government Bond ETFs. GOVI is managed by Invesco. This particular fund, before fees and expenses, seeks to match the performance of the ICE 1-30 YR LADDERED MATURITY US TRSR ID.

The ICE 1-30 Year Laddered Maturity US Treasury Index is designed to track the performance of up to 30 U.S. Treasury Notes or Bonds representing the annual February maturity ladder across the yield curve.

Cost & Other Expenses

Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.

Operating expenses on an annual basis are 0.15% for GOVI, making it on par with most peer products in the space.

The fund has a 12-month trailing dividend yield of 3.15%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, United States Treasury Note/bond-4.50%-02-15-2036 accounts for about 6.72% of total assets, followed by United States Treasury Note/bond-2.75%-02-15-2024 and United States Treasury Note/bond-2.75%-02-15-2028.

Its top 10 holdings account for approximately 37.47% of GOVI's total assets under management.

Performance and Risk

Year-to-date, the Invesco Equal Weight 0-30 Year Treasury ETF has lost about -3% so far, and was up about 0% over the last 12 months (as of 02/29/2024). GOVI has traded between $25.78 and $29.11 in this past 52-week period.

The fund has a beta of 0.12. With about 29 holdings, it has more concentrated exposure than peers.


Invesco Equal Weight 0-30 Year Treasury ETF is not a suitable option for investors seeking to outperform the Government Bond ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.

Vanguard Long-Term Treasury ETF (VGLT - Free Report) tracks Bloomberg Barclays U.S. Long Government Float Adjusted Index and the iShares 20+ Year Treasury Bond ETF (TLT - Free Report) tracks ICE U.S. Treasury 20+ Year Bond Index. Vanguard Long-Term Treasury ETF has $10.56 billion in assets, iShares 20+ Year Treasury Bond ETF has $49.33 billion. VGLT has an expense ratio of 0.04% and TLT charges 0.15%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Government Bond ETFs.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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