Most cash comparisons pit a Treasury fund against a pricier or riskier alternative. This one is different: SGOV and VUSXX are both Treasury-first cash vehicles, and they even charge the identical 0.09% expense ratio. VUSXX is Vanguard's Treasury money market fund; SGOV is the iShares Treasury bill ETF. When two funds are this close, the decision comes down to structure, minimums, and a fine point about the state-tax exemption.
SGOV vs VUSXX at a glance
| SGOV | VUSXX | |
|---|---|---|
| Type | ETF (holds Treasury bills) | Treasury money market mutual fund |
| Issuer | BlackRock (iShares) | Vanguard |
| Expense ratio | 0.09% | 0.09% |
| Holdings | US Treasury bills maturing in 0 to 3 months | US Treasury bills, with some exposure to Treasury repurchase agreements |
| State income tax | Nearly full. SGOV holds essentially only Treasuries, so almost all of its income qualifies for the state and local tax exemption. | High. VUSXX holds mostly Treasuries, so most of its income qualifies for the state exemption. The repo share, when present, does not, so it is usually a notch below SGOV rather than equal. |
| Default cash sweep? | No. An ETF you buy and hold anywhere. | No. It is a fund you buy deliberately. Vanguard's automatic settlement sweep is VMFXX, a different fund. |
| Minimum | One share (fractional at many brokers) | $3,000 initial investment |
| Where you can hold it | Any brokerage | Vanguard accounts (and some other brokers) |
Expense ratios are the funds' stated figures and are stable; 7-day yields move with the Fed and are not shown here. Check each issuer's page for the current yield before comparing.
The fee is a tie, which is unusual
SGOV and VUSXX both charge 0.09%, so the cost advantage that decides most cash comparisons is absent here. Their gross yields both track short-term Treasury rates and land close together. This is genuinely a case where the headline numbers nearly match and the tie-breakers are structural.
ETF versus mutual fund, and a $3,000 door
SGOV is an ETF: you can buy a single share (or a fractional share at many brokers), it trades throughout the day, and you can hold it at any brokerage. VUSXX is a mutual fund with a $3,000 minimum initial investment, it transacts once a day at its set price, and it lives inside Vanguard. For a smaller balance or an account held away from Vanguard, that minimum and the platform limit are the practical dividing line. For a larger balance already at Vanguard, they are a non-issue.
People often confuse VUSXX with VMFXX, Vanguard's settlement fund and automatic sweep. They are different: VMFXX is a government fund that holds more repos, while VUSXX is the more Treasury-pure option chosen deliberately. Our SGOV vs VMFXX page covers the settlement-fund version of this question.
A small state-tax edge to SGOV
Both funds are Treasury-heavy, so both pass through most of the state-tax exemption, far more than a prime fund like SWVXX or a repo-heavy government fund. The fine point: SGOV holds essentially only Treasury bills, while VUSXX has at times held some Treasury repurchase agreements, and the repo portion does not qualify for the exemption. That usually leaves SGOV a notch higher on the qualifying percentage, though both are strong. The exact figures appear in each fund's year-end tax documents, and the mechanic is in is SGOV exempt from state tax.
A near tie decided by structure, not cost
SGOV and VUSXX are the closest pair in the cash category: same 0.09% fee, both Treasury-first, similar gross yields. The tie-breakers are structural. SGOV is an ETF with no minimum that holds anywhere and edges VUSXX on state-tax purity. VUSXX is a Vanguard mutual fund with a $3,000 minimum that some investors prefer for its once-a-day simplicity inside a Vanguard account. This is a preference-and-logistics decision more than a numbers decision.
Which fits which situation
SGOV tends to fit
An investor who wants no minimum, the flexibility to hold at any brokerage, intraday trading, and the slightly purer state-tax exemption from a Treasury-only portfolio.
VUSXX tends to fit
A Vanguard investor with at least $3,000 to commit who prefers a traditional mutual fund's once-daily pricing and does not need to hold the position outside Vanguard.
Cash, yields, and the tax math, weekly.
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Common questions
They are unusually close. Both are Treasury-first cash vehicles charging 0.09%, with similar gross yields. SGOV is an ETF with no minimum that trades anywhere and holds only Treasury bills, giving it a slight state-tax edge. VUSXX is a Vanguard mutual fund with a $3,000 minimum that some prefer for once-a-day simplicity. Neither is clearly better; it is a structure-and-preference choice. This is educational information, not a recommendation.
VUSXX is Vanguard's Treasury Money Market Fund, held mostly in Treasury bills, and you buy it deliberately. VMFXX is the Federal Money Market Fund, Vanguard's default settlement sweep, which holds more repurchase agreements and agency debt. VUSXX is generally the more Treasury-pure of the two, which gives it a fuller state-tax exemption. People often mix them up because both are Vanguard cash funds.
Yes, VUSXX has a $3,000 minimum initial investment, which is standard for Vanguard money market funds. SGOV, as an ETF, has no minimum beyond the price of one share, and many brokers allow fractional shares. For a smaller cash balance, that minimum is one of the clearest practical differences between the two.
Mostly. VUSXX holds primarily US Treasuries, so most of its income qualifies for the state and local tax exemption. Any Treasury repurchase-agreement portion does not qualify, so its qualifying percentage is usually high but a touch below SGOV's, which holds essentially only Treasury bills. Both funds publish the exact figure in their year-end tax documents.
VUSXX is a Vanguard fund and is most straightforward to hold in a Vanguard account; availability at other brokers is limited and may carry transaction fees. SGOV, being an ETF, trades commission-free at essentially any brokerage. If you are not a Vanguard customer, that access difference is a practical reason the two are not interchangeable.