At a glance
SDFI charges 1.8% a year, above the 0.07% average of the 7 funds most like it (the most expensive of 8). It has $58.8M in assets, the 8th largest of that group; it paid 4.55% of its price in distributions over the past 12 months, monthly. Over the past year it returned +1.4% with distributions reinvested, the weakest of those 8 funds.
The short version
AB Short Duration Income ETF (SDFI), from AllianceBernstein, held mostly short-term US Treasury bills and notes as of August 31, 2026, plus a small set of S&P 500 index options. Two things set it apart from plain Treasury funds such as iShares Short Treasury Bond ETF (SHV): the options positions, and a cost of 1.80% a year in its March 26, 2026 prospectus. Similar funds average 0.07%.
Price history
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SDFI +1.4% over the year to Oct 27, 2026, total return with distributions reinvested.
How it has behaved
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | Since start | |
|---|---|---|---|---|---|---|
| SDFI price data to Oct 27, 2026 | +0.9% | +1.4% | — | — | — | +4.6% |
- Over the year to Oct 27, 2026, SDFI returned +1.4%, 8th of 8 among similar funds.
- Its worst full calendar year was 2025 (+6.4%); its best was 2025 (+6.4%).
- The deepest fall in its price history was 1.6% (Aug 25, 2026 to Sep 29, 2026), not yet recovered.
Show as a table
| Year | Price data |
|---|---|
| 2026 (to date) | +0.9% |
| 2025 | +6.4% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Before this security existed |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Before this security existed |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Before this security existed |
Dividends and income
Show as a table
| Year | Per share | Change |
|---|---|---|
| 2026 (to date) | $1.1600 | |
| 2025 | $1.6700 |
What's inside
As of Aug 31, 2026, the fund held 5 securities; the ten largest made up 90.49% of assets, and 7.52% sat in cash and money-market holdings.
| Holding | Weight | |
|---|---|---|
| TREASURY BILL Bonds and notes | 20.22% | |
| TREASURY BILL Bonds and notes | 19.48% | |
| TREASURY BILL Bonds and notes | 18.91% | |
| TREASURY BILL Bonds and notes | 17.63% | |
| US TREASURY N/B Bonds and notes | 14.26% |
By country
United States 90.49%By issuer
US Treasury 90.49%The bonds mature in 0.3 years on average (weighted by size), with an average coupon of 0.37%.
Source: N-PORT holdings report as of Aug 31, 2026. Cash, money-market funds and derivatives are shown separately from the securities list.What changed recently
- Over the three months to Aug 31, 2026, investors added a net $13.6M (creations minus redemptions, per the N-PORT report).
- Monthly total returns reported for that quarter: +1.07%, +0.91%, +1.52%.
How it works
As of August 31, 2026, about 90.5% of SDFI's assets were in US Treasury debt. Four Treasury bills made up 20.2%, 19.5%, 18.9% and 17.6% of the fund, and a Treasury note added 14.3%. Cash was 7.5%. Treasury bills are short-term loans to the US government that mature in a year or less. The average time to maturity was 0.3 years, about four months. Bond prices fall when interest rates rise, but maturities this short limit that effect.
The fund also held four S&P 500 index options, all expiring September 11, 2026. It sold a put option at 6,800 and bought one at 6,750. It also sold a call option at 8,350 and bought one at 8,400. Selling an option brings in cash up front, called a premium. If the index stays between the two sold strike prices, those options expire worthless and the fund keeps the premium. If the index moves past either one, the fund pays the difference. The bought options cap that loss at the gap between each pair. Together, the options were valued at -0.17% of assets.
Options this short-dated expire within weeks, so this part of the fund changes often. Shares trade at market prices that can sit above or below the value of the holdings. With $58.8 million in net assets, trading activity may be thin.
What it really costs
- SDFI charges 1.8% a year, versus an average of 0.07% for the similar funds below (8th of 8, cheapest first).
- Of that, 0.4% is the management fee; the rest covers other fund expenses.
- Using the prospectus's standard example, $10,000 invested would cost about $183 in the first year and $— over 10 years (assuming a 5% annual return).
| Cost of $10,000 (SEC example) | 1 yr | 3 yrs | 5 yrs | 10 yrs |
|---|---|---|---|---|
| SDFI | $183 | $566 | $— | $— |
Structure and tax notes
- Bond prices move opposite to interest rates; the longer the maturities it holds, the more its price reacts to rate changes.
In a retirement portfolio
It paid a 4.55% trailing yield in monthly distributions from a portfolio held mostly in Treasury bills, but its S&P 500 options and high cost are trade-offs.
SDFI launched on June 10, 2024, so it has no record from the 2008, 2020 or 2022 downturns. Its only full calendar year, 2025, returned 6.39%. Its deepest drop was 1.6%, from August 25 to September 29, 2026, and it had not recovered as of October 27, 2026. Its price has moved little (1.9% volatility over one year). That can help someone who may need to sell shares in a bad year. But a sharp S&P 500 move could cause losses through the options that a plain Treasury-bill fund would avoid. As of October 27, 2026, the trailing 12-month yield was 4.55% ($1.59 a share), paid monthly. Costs are high: $183 in the first year on the SEC's standard $10,000 example. Past results don't predict future ones, and a plan should look at the whole portfolio, not one fund.
Who it may suit — and who should look elsewhere
May suit
- Investors seeking monthly income from a fund that held about 90% short-term US Treasuries as of August 31, 2026.
- Holders comfortable with a small S&P 500 options position that earns premiums in addition to Treasury-bill interest.
- People who value small price swings: one-year volatility was 1.9%, and the deepest drop was 1.6% as of October 27, 2026.
Look elsewhere if
- Cost-focused investors: SDFI's 1.80% expense ratio compares with 0.15% for SHV and 0.03% for VGSH and SCHO.
- Investors who want only Treasuries: SDFI's 1.4% one-year return trailed SHV's 3.7% (late October 2026), and its options add stock-market risk.
- Those wanting a long record: SDFI launched June 10, 2024, missed the 2008, 2020 and 2022 downturns, and held $58.8 million.
Close alternatives
Matched by bond funds with the closest average maturity and issuer mix (N-PORT).
| Fund | Avg. maturity | Cost | Net assets | 1 yr | 3 yr |
|---|---|---|---|---|---|
| SDFI this fund | 0.3 yrs | 1.8% | $58.8M | +1.4% | — |
| SHV iShares Short Treasury Bond ETF | 0.3 yrs | 0.15% | $20.97B | +3.3% | +4.3% |
| VGSH Vanguard Short-Term Treasury ETF | 1.9 yrs | 0.03% | $39.20B | +2.2% | +4.2% |
| SCHO Schwab Short-Term U.S. Treasury ETF | 1.9 yrs | 0.03% | $12.95B | +2.1% | +4.2% |
| VTIP Vanguard Short-Term Inflation-Protected Sec… | 2.4 yrs | 0.03% | $71.01B | +2.8% | +5.3% |
| BSV Vanguard Short-Term Bond ETF | 2.9 yrs | 0.03% | $69.75B | +1.7% | +4.5% |
| JPST JPMorgan Ultra-Short Income ETF | 2 yrs | 0.18% | $41.13B | +3.1% | +4.8% |
| SPSB SPDR Portfolio Short Term Corporate Bond ETF | 2.4 yrs | 0.04% | $10.63B | +2.3% | +5.1% |
Questions investors ask
What does SDFI invest in?
Mostly short-term US government debt. As of August 31, 2026, the SEC holdings report for this AllianceBernstein fund showed 90.49% of assets in five US Treasury issues. Four were Treasury bills, which are short-term government IOUs, and one was a Treasury note at about 14.3%. Cash made up 7.52%, and the average time to maturity was 0.3 years. The report also listed four options on SPX, an index of large US stocks, expiring September 11, 2026. Two were sold and two bought, netting a small liability of about 0.17% of assets.
Does SDFI pay monthly dividends?
Yes. SDFI pays income monthly. Over the 12 months to October 27, 2026, it paid about $1.59 per share. That is a trailing yield of 4.55%, meaning the past year's income divided by the share price. As of August 31, 2026, most of its assets sat in Treasury bills, whose yields closely follow the Federal Reserve's policy rate. Payouts can shrink if short-term rates fall, so retirees drawing on it for spending money may see the monthly amount vary.
Is SDFI safe for retirement savings?
It has little interest-rate risk, but it is not risk-free. Its holdings averaged 0.3 years to maturity as of August 31, 2026, so rate changes should barely move its price. Still, its price fell 1.6% from August 25 to September 29, 2026, and had not recovered by October 27, 2026. Its stock-index options add a risk that a plain Treasury fund does not carry. It may suit investors who want a short-term place to hold cash rather than long-term growth.
What's the difference between SDFI and SHV?
SHV, the iShares Short Treasury Bond ETF, is the closest match by maturity and type of borrower. Both averaged 0.3 years to maturity. SHV is far larger, with about $21 billion in net assets versus about $58.8 million for SDFI, both as of August 31, 2026. SHV returned 3.7% over one year as of October 30, 2026, versus 1.4% for SDFI as of October 27, 2026. SHV charges 0.15% a year, a figure worth comparing with the fee in SDFI's prospectus. SDFI also held stock-index options.
How has SDFI performed since it launched?
Unevenly, over a short record. SDFI launched on June 10, 2024, so it has about 2.4 years of history and has not been tested by a major market crash. It returned 6.39% in 2025, then 0.87% in 2026 through October 27. Based on its market price, its one-year return was 1.4% as of October 27, 2026. Its one-year Sharpe ratio, a measure of return for the risk taken, was -1.34. That means it earned less than very short-term Treasury bills over that stretch.