TIP vs. MINT: What’s The Difference?

The iShares TIPS Bond ETF (TIP) and the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) are both among the Top 100 ETFs. TIP is a iShares Inflation-Protected Bond fund and MINT is a PIMCO Ultrashort Bond fund. So, what’s the difference between TIP and MINT? And which fund is better?

The expense ratio of TIP is 0.17 percentage points lower than MINT’s (0.19% vs. 0.36%). TIP is mostly comprised of AAA bonds and MINT has a high exposure to Others bond. Overall, TIP has provided higher returns than MINT over the past ten years.

In this article, we’ll compare TIP vs. MINT. We’ll look at fund composition and performance, as well as at their risk metrics and industry exposure. Moreover, I’ll also discuss TIP’s and MINT’s portfolio growth, holdings, and annual returns and examine how these affect their overall returns.

Summary

TIP MINT
Name iShares TIPS Bond ETF PIMCO Enhanced Short Maturity Active Exchange-Traded Fund
Category Inflation-Protected Bond Ultrashort Bond
Issuer iShares PIMCO
AUM 28.3B 14.02B
Avg. Return 4.07% 1.52%
Div. Yield 1.87% 0.56%
Expense Ratio 0.19% 0.36%

The iShares TIPS Bond ETF (TIP) is a Inflation-Protected Bond fund that is issued by iShares. It currently has 28.3B total assets under management and has yielded an average annual return of 4.07% over the past 10 years. The fund has a dividend yield of 1.87% with an expense ratio of 0.19%.

The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) is a Ultrashort Bond fund that is issued by PIMCO. It currently has 14.02B total assets under management and has yielded an average annual return of 1.52% over the past 10 years. The fund has a dividend yield of 0.56% with an expense ratio of 0.36%.

TIP’s dividend yield is 1.31% higher than that of MINT (1.87% vs. 0.56%). Also, TIP yielded on average 2.55% more per year over the past decade (4.07% vs. 1.52%). The expense ratio of TIP is 0.17 percentage points lower than MINT’s (0.19% vs. 0.36%).

Fund Composition

Holdings

TIP - Holdings

TIP Bond Sectors Weight
AAA 99.31%
Others 0.69%
Below B 0.0%
B 0.0%
BB 0.0%
BBB 0.0%
A 0.0%
AA 0.0%
US Government 0.0%

TIP’s Top Bond Sectors are ratings of AAA, Others, Below B, B, and BB at 99.31%, 0.69%, 0.0%, 0.0%, and 0.0%. The fund is less weighted towards BBB (0.0%), A (0.0%), and AA (0.0%) rated bonds.

MINT - Holdings

MINT Bond Sectors Weight
Others 0.0%
Below B 0.0%
B 0.0%
BB 0.0%
BBB 0.0%
A 0.0%
AA 0.0%
AAA 0.0%
US Government 0.0%

MINT’s Top Bond Sectors are ratings of Others, Below B, B, BB, and BBB at 0.0%, 0.0%, 0.0%, 0.0%, and 0.0%. The fund is less weighted towards A (0.0%), AA (0.0%), and AAA (0.0%) rated bonds.

Risk Analysis

TIP MINT
Mean Return 0.28 0.12
R-squared 66.57 4.7
Std. Deviation 4.33 1.08
Alpha -0.58 0.62
Beta 1.18 0.08
Sharpe Ratio 0.62 0.78
Treynor Ratio 2.24 10.8

The iShares TIPS Bond ETF (TIP) has a Sharpe Ratio of 0.62 with a R-squared of 66.57 and a Alpha of -0.58. Its Mean Return is 0.28 while TIP’s Treynor Ratio is 2.24. Furthermore, the fund has a Beta of 1.18 and a Standard Deviation of 4.33.

The PIMCO Enhanced Short Maturity Active Exchange-Traded Fund (MINT) has a Alpha of 0.62 with a Beta of 0.08 and a Mean Return of 0.12. Its Standard Deviation is 1.08 while MINT’s Sharpe Ratio is 0.78. Furthermore, the fund has a R-squared of 4.7 and a Treynor Ratio of 10.8.

TIP’s Mean Return is 0.16 points higher than that of MINT and its R-squared is 61.87 points higher. With a Standard Deviation of 4.33, TIP is slightly more volatile than MINT. The Alpha and Beta of TIP are 1.20 points lower and 1.10 points higher than MINT’s Alpha and Beta.

Performance

Annual Returns

TIP vs. MINT - Annual Returns

Year TIP MINT
2020 10.91% 1.63%
2019 8.28% 3.3%
2018 -1.43% 1.72%
2017 2.92% 1.9%
2016 4.56% 1.99%
2015 -1.59% 0.52%
2014 3.49% 0.53%
2013 -8.65% 0.72%
2012 6.8% 2.48%
2011 13.4% 0.42%
2010 6.1% 1.72%

TIP had its best year in 2011 with an annual return of 13.4%. TIP’s worst year over the past decade yielded -8.65% and occurred in 2013. In most years the iShares TIPS Bond ETF provided moderate returns such as in 2014, 2016, and 2010 where annual returns amounted to 3.49%, 4.56%, and 6.1% respectively.

The year 2019 was the strongest year for MINT, returning 3.3% on an annual basis. The poorest year for MINT in the last ten years was 2011, with a yield of 0.42%. Most years the PIMCO Enhanced Short Maturity Active Exchange-Traded Fund has given investors modest returns, such as in 2020, 2018, and 2010, when gains were 1.63%, 1.72%, and 1.72% respectively.

Portfolio Growth

TIP vs. MINT - Portfolio Growth

Fund Initial Balance Final Balance CAGR
TIP $10,000 $14,353 4.07%
MINT $10,000 $11,624 1.52%

A $10,000 investment in TIP would have resulted in a final balance of $14,353. This is a profit of $4,353 over 10 years and amounts to a compound annual growth rate (CAGR) of 4.07%.

With a $10,000 investment in MINT, the end total would have been $11,624. This equates to a $1,624 profit over 10 years and a compound annual growth rate (CAGR) of 1.52%.

TIP’s CAGR is 2.55 percentage points higher than that of MINT and as a result, would have yielded $2,729 more on a $10,000 investment. Thus, TIP outperformed MINT by 2.55% annually.


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