Q. I never really understood the G Fund. Am I correct in believing that as long as I leave money in the G Fund, the value of the G Fund will never decrease? Further, the yield is influenced mostly by the yield on the 10-year Treasury. So, as these interest rates rise so probably will the yield on the 10-year Treasury?
A. The value of your position in the G Fund is guaranteed against loss by the U.S. government. The interest it earns is based on the weighted average interest due on all outstanding US Treasury debt. As that index rate rises, so will the return on your investment in the G Fund.