Treasury Inflation Protected Securities (TIPS) provide protection against inflation for investors. In practice the principal of a TIPS increases with inflation and decreases with deflation, as measured by the Consumer Price Index. When a TIPS matures you are paid the adjusted principal or original principal, whichever is greater.

TIPS performed very well between 2009 and 2011 as inflation expectations suggested a rise, but since that point as the U.S. and indeed global economy has slowed and more recently as oil prices have come down, the outlook for inflation is that it will remain low for the near future.

Vanguard is in the TIPS business through its Vanguard Inflation-Protected Securities Fund, and now Vanguard has a new TIPS offering with a few unique differences: first it is shorter term in nature, and it’s index-based, meaning it’s ETF-eligible. And, in one sense you could see this as a money fund alternative.

That’s right. An ETF and a money fund.

While the behemoth original, now weighing in at $43 billion in AUM, may be the largest pure TIPS offering in the fund world, there are no ETF shares available on it because, well, it’s a “managed” fund—though the portfolio is about as plain-vanilla as they come.

While rumors have swirled that Vanguard was on the verge of getting SEC approval to issue ETF shares on “the original” this hasn’t come to pass. Not willing to wait for a way to get into the ETF marketplace with a TIPS offering, the new fund, based on the Barclays U.S. Treasury Inflation-Protected Securities 0-5 Year Index is the next best thing.

This index is already in use in the iShares STIP ETF which currently has about $360 million in AUM. That fund’s profile page doesn’t show a “yield” per se and while the index sports a 0.60% yield to worst it’s pretty clear that this is not a yield offering but rather a money-market alternative.

Yes, a money-market alternative. While money funds are currently paying 1 or 2 basis points and have no inflation protection, at least this fund can offering inflation protection with any yield to be a bit of icing on the cake.

The short-term TIPS market is thin. The current Barclays index contains just 14 issues.

Will it accommodate Vanguard-driven demand? I’d say that money market yields may be a key driver of demand for this alternative.