Keep it simple. Keep it safe. 

Ultra-short-term bond ETFs, which invest in bonds with durations of less than a year, work to do both, providing low risk and high liquidity. Of course, there’s a drawback: A side effect of the strategy is that it caps returns far below those of longer-term funds, historically curbing inflows during periods of stable economic growth. 

Investors, however, have apparently had a change of heart during the spiking volatility of the past 18 months, driven by trade wars, sticky inflation and soaring oil prices due to the US war with Iran. A case in point is the industry’s largest ultra-short bond ETF, which is racing toward the $100 billion mark. If (and more likely when) the iShares 0-3 Month…