In 2022, TLT (the iShares 20+ Year Treasury Bond ETF) lost 31.2% with dividends counted, which means the payouts are treated as reinvested. An ETF, or exchange-traded fund, is a fund that trades on a stock exchange. TLT holds US Treasuries, which are bonds the US government issues to borrow money.
An example 10-year bond paying the 1.88% par yield of January 2020 also lost value on paper in 2022. Held to maturity, the day it repays its face value (the amount borrowed), it still repays in full, at the rate fixed on the day of purchase. A bond fund that tracks a rolling index (an index that keeps swapping in new bonds as old ones age), as TLT does, has no such day. We wrote this on 11 November 2026, with prices to 10 November and interest rates to 9 November.
Is a bond ETF better than individual bonds? It depends on the job. A Treasury held to maturity gives a rate and a repayment date known on the day of purchase. A bond ETF that tracks a rolling index (one that keeps swapping in new bonds as old ones age), like TLT, never matures, so its price and its income keep changing.
A buyer of a Treasury with 20 years left on 2 January 2020 locked in 2.19% a year, while a buyer with 10 years left locked in 1.88%. A buyer on 9 November 2026 could lock in 5.29% and 4.88%.
From 2 January 2020 to 10 November 2026, TLT lost 27.2%, IEF (the intermediate-term Treasury bond ETF) lost 2.2%, and AGG (the broad US bond market ETF) gained 4.3%, with dividends counted.
Holding to maturity does not stop the price falling in between. For a bond bought near face value, a fall in price costs nothing in dollars unless the bond is sold early, but the buyer is stuck with the old rate.
What does holding a bond to maturity mean?
A bond is a loan. The buyer lends money for a fixed term and collects interest, called the coupon, usually every six months. On the maturity date, the borrower repays the face value. Our explainer on Treasury bills, notes, and bonds covers the three types.
Holding to maturity means keeping the bond until that date. The buyer then receives every coupon and the face value, whatever the market price did in between. That holds if the US government pays as promised.
A yield is the annual return a buyer earns at the current price. The rate a buyer locks in is the par yield. It is the annual rate a Treasury with that many years left would pay if priced at face value, called par, read from the Treasury yield curve.
The Board of Governors of the Federal Reserve System publishes it each day in its H.15 release. We use the 20-year and 10-year series.
What did a January 2020 or 2021 buyer lock in?
On 2 January 2020, the 20-year par yield was 2.19% and the 10-year was 1.88%. On 4 January 2021, they were 1.46% and 0.93%. The Treasury sold no 20-year bond between 1986 and May 2020, so the two 20-year readings are curve estimates, per the Federal Reserve Bank of New York.
Per $10,000 of face value, an example 10-year bond paying the 1.88% par yield pays about $188 a year in coupons until it matures.
Source: Board of Governors of the Federal Reserve System, H.15 release; YX Insights
We searched the daily series from 2 January 2020 to 9 November 2026. The lowest 20-year yield was 0.87% on 9 March 2020. The lowest 10-year yield was 0.52% on 4 August 2020. The highest were 5.71% for the 20-year on 7 October 2026 and 5.31% for the 10-year on 5 October 2026.
On 9 November 2026, the last day in the series, the two yields were 5.29% and 4.88%. A buyer from January 2021 holds 0.93% on a 10-year, against 4.88% for a new buyer.
What happened to the price in 2022?
Bond prices fall when yields rise. Our explainer on bond prices and yields shows why. The 20-year yield rose 2.20 points in 2022, from 1.94% on 31 December 2021 to 4.14% on 30 December 2022.
TLT lost 31.2% in 2022, with dividends counted.
The example 10-year bond fell too. By our calculation, its price on 30 December 2022 was about 87.4 per 100 of face value, a paper fall of 12.6% since purchase.
We priced it as a 1.88% bond with seven years left, using the 7-year par yield of 3.96%. This is a calculated price, not a quote.
That bond still repays 100 at maturity. A buyer who sold on 30 December 2022 took the 12.6% fall in price, less the coupons already collected. A buyer who kept it did not.
How did the three bond funds do since January 2020?
IEF is the iShares 7-10 Year Treasury Bond ETF. AGG is the iShares Core U.S. Aggregate Bond ETF.
AGG had 13,514 holdings on 10 November. Its weights on 9 November were 46.65% Treasuries, 23.08% mortgage pass-through bonds, and 14.46% industrial company bonds. Mortgage pass-through bonds are backed by pools of home loans.
Chart 2 starts each fund at 100 on 2 January 2020, with dividends counted. It ends on 10 November 2026, which is 1,724 trading days over 6.86 years.
Source: YX Insights price data
TLT ended at 72.8, a loss of 27.2%, or 4.5% a year. IEF ended at 97.8, a loss of 0.3% a year. AGG ended at 104.3, a gain of 4.3%, or 0.6% a year.
The worst fall from a high ran from 4 August 2020 to 19 October 2023 for TLT and IEF. TLT fell 48.3% and IEF fell 23.9%. AGG fell 18.4% from 4 August 2020 to 20 October 2022.
On 10 November 2026, TLT sat 42.4% below its August 2020 high. IEF sat 12.7% below. AGG sat 3.1% below.
Which years did the three funds lose money?
Source: YX Insights price data
Chart 3 shows each fund's return by calendar year, with dividends counted. All three funds lost money in 2021, 2022, and 2026 to date. TLT and IEF also lost money in 2024, while AGG gained 1.3%.
Why does TLT never mature?
TLT never matures. It tracks an index of Treasuries with more than 20 years left. Its weighted average maturity, the average years left across its bonds, was 26.03 years on 10 November 2026. To keep tracking that index, the fund replaces bonds as they age.
So no repayment date pulls the price back to face value.
The fund's income does reset. TLT paid $2.22 a share in 2021 and $3.86 in 2025, in twelve payments each year. Against the prior year-end price, that is 1.41% and 4.42%.
The issuer's average yield to maturity was 5.41% across TLT's 47 bonds on 10 November 2026. That is the annual return if every bond were held to its end date at 10 November 2026 prices. It describes the bonds, not a promise to shareholders.
Which is better, a bond ETF or an individual bond?
A known end value on a known date: the individual bond, if the US government pays as promised.
Price swings along the way: neither. Both fell in 2022.
Spreading money across many bonds in one purchase: the fund. AGG has 13,514 holdings.
Income that resets as rates change: the fund.
The bond's advantage disappears when the money is needed before the maturity date. The bond then sells at its market price, as a fund share does.
Our explainer on IEF against TLT compares the two funds. Our explainer on the 2022 bond market crash covers the fall.
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Common questions about bond ETFs and individual bonds
Is a bond ETF safer than individual bonds?
Neither is safer on price in the meantime, because both fall when yields rise, as both did in 2022. The end date separates them. A Treasury held to maturity repays its face value on a fixed day, if the US government pays as promised. A bond ETF has no such day.
Do bond ETFs lose money when rates rise?
Yes, their prices fall when yields rise. In 2022 the 20-year Treasury yield rose from 1.94% to 4.14%. TLT lost 31.2% and IEF lost 15.2%, with dividends counted. TLT's payouts later rose, from $2.22 a share in 2021 to $3.86 in 2025.
Can you lose money holding a bond to maturity?
No, not in dollars if the US government pays as promised and the bond is bought near face value. The face value comes back whatever the price did in between. The cost is the rate forgone. A January 2021 buyer of a 10-year locked in 0.93%, while a new buyer on 9 November 2026 could lock in 4.88%.
What is the difference between TLT and a 20-year Treasury?
TLT is a fund of 47 Treasuries with more than 20 years left. It keeps replacing bonds as they age, so it never matures. A single 20-year Treasury has one maturity date and one fixed coupon. Its remaining life shrinks every year. Its price becomes less sensitive to rates.
DISCLAIMER: This article is intended for educational purposes only. Any information or analysis in this note does not constitute an offer to sell or a solicitation of an offer to buy any securities. Nothing in this note is intended to be investment advice, nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.
