TLT DCA Backtest
If you'd invested $700 every month, how long to $1M?
TLT (iShares 20+ Year Treasury Bond ETF) holds only U.S. Treasury bonds with more than 20 years left to maturity. iShares (BlackRock) launched it in 2002, investing in ultra-long-term bonds issued by the U.S. government. It's a bond product, not a stock, so its risk profile is fundamentally different from the other tickers on this site.
Even over the full period, that's about $246.57K today · invested $202.3K · annualized +4%
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Bond ETFs are a 'lend money, collect interest' asset
A Treasury bond is a certificate the government issues when it borrows money — it pays interest over a set period and repays the principal at maturity. TLT holds only U.S. Treasuries with 20-plus years left until maturity, and it passes the interest it collects along to shareholders as a monthly distribution.
U.S. Treasuries are considered among the highest-credit-quality bonds in the world, so default risk is low. But as explained below, that absolutely does not mean the price doesn't move.
The longer the maturity, the more sensitive to rates
Bond prices move opposite to prevailing interest rates. When rates rise, older bonds paying lower interest become less attractive and their prices fall; when rates fall, prices rise. This sensitivity grows with maturity, and since TLT holds only ultra-long-term bonds (20+ years), its price reacts especially strongly.
That's why, despite the 'safe asset' label, TLT's share price can actually be quite volatile. There have been periods when central banks raised rates quickly and TLT fell nearly as sharply as stocks. Approaching it with a simple 'Treasuries equal safe' mindset can leave you surprised by these swings.
The 'moves opposite stocks' rule doesn't always hold
Bonds have traditionally been seen as moving opposite stocks, which helps stabilize a portfolio: when the economy weakens and stocks fall, central banks cut rates, and bond prices rise in response.
But that relationship can break down during periods when rates need to rise to fight inflation. There have been stretches when surging inflation pushed rates up sharply, and stocks and TLT fell together — the 'diversification effect' didn't work as expected. It's worth knowing that TLT can behave this way in certain environments.
Taxes, allocation, and this calculator
How capital gains and interest distributions are taxed depends entirely on your country of residence and personal situation — this isn't tax advice, so check with a local tax professional rather than assuming a single rate applies. One note on the numbers here: this site's results are pre-tax, computed on an interest-reinvested adjusted-close basis, so your actual after-tax outcome can differ.
TLT is usually held less for long-term price appreciation the way stock ETFs are, and more to manage a portfolio's overall volatility or as a bet on falling rates. The result of accumulating in TLT alone in this calculator is just a simulation of one specific past period, and bonds too can produce very different outcomes depending on your start date. This article is for information, not investment advice.
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This content is for informational purposes and is not investment advice or a recommendation. You are solely responsible for your investment decisions.