Where Warren Buffett Goes, Wall Street Follows: The $25B Bill Binge
Rising Treasury Yields: Treasury yields are increasing due to political factors and a focus on short-term bonds, with investors favoring ultra-short bond ETFs amid uncertainty in the market.
Investor Behavior: Warren Buffett's significant investment in short-term T-bills reflects a broader trend where investors seek stability and yield in a volatile environment, leading to substantial inflows into these securities.
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SPDR Bloomberg Barclays 1-3 Month T-Bill ETF: The ETF has a current price of $0.2812 and a 30-Day SEC Yield of 3.73% as of November 26, with dividends payable on December 4 for shareholders of record on December 1.
Treasury Yield Trends: The entire Treasury yield curve has increased since the Fed's rate cut, with the 10-year US Treasury yield falling below 4.00% as markets adjust expectations regarding the Fed's future actions.
Inflation Concerns: There is ongoing concern in the bond market about inflation and supply, which may impact the Federal Reserve's decision-making regarding interest rates.
Future Projections: Weekly Treasury simulations indicate that the most likely range for 3-month T-Bill rates ten years forward is projected to be between 1% to 2%, reflecting a slight upward adjustment in expectations.
BIL Share Price Analysis: BIL's current share price is $91.66, situated between its 52-week low of $91.29 and high of $91.80, with a reference to the 200-day moving average for technical analysis.
Understanding ETFs: Exchange-traded funds (ETFs) function like stocks, where investors buy and sell "units" that can be created or destroyed based on demand, impacting the underlying assets.
Monitoring ETF Flows: Weekly monitoring of changes in shares outstanding helps identify ETFs with significant inflows (new units created) or outflows (units destroyed), which can affect the underlying holdings.
Disclaimer on Views: The opinions expressed in the article are those of the author and do not necessarily represent the views of Nasdaq, Inc.
Investor Trends in ETFs: U.S.-listed ETFs saw nearly $19 billion in inflows during the week ending August 8, primarily driven by fixed income investments, particularly bond ETFs which attracted $15.3 billion, reflecting a defensive market sentiment amid expectations of Federal Reserve rate cuts.
Market Outlook and Preferences: While bonds dominated the inflows, some equity ETFs like the Communication Services Select Sector SPDR Fund and Vanguard S&P 500 ETF also received significant attention, indicating selective buying as investors navigate geopolitical tensions and economic uncertainties.

Druckenmiller's Investment Strategy: Legendary investor Stanley Druckenmiller has been shorting long-term U.S. Treasury bonds, allocating 15% to 25% of his portfolio to this strategy over the past year.
Market Impact and Attention: His significant bearish position on U.S. government debt gained notable attention in fall 2024, highlighting his approach to aligning policy with investment opportunities.

AI's Impact on Wall Street: Research by Alejandro Lopez-Lira, an assistant professor of finance, explores whether AI can replace Wall Street traders, focusing on stock-picking capabilities of AI chatbots like ChatGPT, DeepSeek, and Grok.
Positive Findings: Lopez-Lira has found promising results in using current AI technologies for trading equities, indicating a potential shift in the finance industry.
Rising Treasury Yields: Treasury yields are increasing due to political factors and a focus on short-term bonds, with investors favoring ultra-short bond ETFs amid uncertainty in the market.
Investor Behavior: Warren Buffett's significant investment in short-term T-bills reflects a broader trend where investors seek stability and yield in a volatile environment, leading to substantial inflows into these securities.








