The Best Euro Government Bond ETFs to Buy

Despite the recent sell-off, eurozone government bonds remain a popular lower-risk building block in well-diversified portfolios.

“We expect them to deliver higher returns than cash over the long term while providing more stability to portfolios than equities,” says Shannon Kirwin, principal for fixed income at Morningstar.

Investor demand has remained resilient: The asset class recorded positive net inflows for four consecutive months, according to Morningstar data.

What Are Euro Government Bond Funds?

Euro government bond portfolios primarily invest in government securities or agency securities explicitly backed by governments. These securities are denominated in euros or hedged to eliminate currency risk.

“Allocation to euro government bonds is typically buy-and-hold in nature; something for the long term,” says Morningstar analyst Jose Garcia-Zarate. “The costs of regular rebalancing can easily offset the potential benefits of alpha-generating calls. This places low-cost passive funds in a strong position to deliver returns above the average category peer—inclusive of actively managed funds—over extended periods.”

The 3 Best Euro Government Bond ETFs to Buy

We screened for those earning a

of Gold with 100% analyst coverage. All the ETFs on the list fall into the EUR government bond and have at least EUR 100 million in assets.

1. iShares Core € Govt Bond UCITS ETF EUNH
2. Xtrackers II Eurozone Government Bond UCITS ETF
3. Amundi Index Solutions - Amundi Prime Euro Government Bond UCITS ETF PR1R

Morningstar expects the highly rated EUR government bond funds on this list to outperform their peers over a full market cycle. But even though all the funds on our list fall into the same category, they may practice different strategies, and therefore behave differently from each other. Investors need to do some homework to understand exactly what a particular fund invests in before buying.

Here’s a quick look at each of the three ETFs. Be sure to review a fund’s complete report for more details.

iShares Core € Govt Bond UCITS ETF

• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★
• Ongoing Charge: 0.07
• 12 Month Yield: 2.65%

The EUR 6.2 billion fund has lost 0.36% over the past 12 months, while the average fund in its category is down 0.57%. The iShares fund, which launched in April 2009, has climbed 1.95% over the past three years and lost 2.81% over the past five years.

The eurozone government bond market is highly liquid, and opportunities to add value over a standard benchmark are limited over the long term. This makes an all-issuer, all-maturity, and low-cost index-tracking approach like this one akin to a default option for investors seeking a core holding for this market exposure. The low ongoing charge levied by this strategy provides a solid tailwind to returns.

Passive funds providing exposure to the eurozone sovereign bond market track indexes from different providers, and so there may be slight differences in bond selection. However, this has not translated into discernible variations in performance between passive peers over recent years. This strategy tracks an all-maturity index covering both core and peripheral issuers with an investment-grade rating.

Read Morningstar’s full report on the iShares Core € Govt Bond UCITS ETF.

Xtrackers II Eurozone Government Bond UCITS ETF

• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : N/A
• Ongoing Charge: 0.06
• 12 Month Yield: N/A%

The Xtrackers fund was launched very recently—in June 2026.

Xtrackers uses physical replication to track the performance of the iBoxx EUR Sovereigns Eurozone Index. From inception until September 2016, the fund was swap-based.

Portfolio managers use stratified sampling. The index is broken down into sections, each representing key risk factors such as duration, currency, country, rating, and sector. The managers then choose bonds included in the index that mimic the risk profile of each section. The aggregate result is a portfolio that represents the index’s overall risk profile, while allowing the exchange-traded fund manager to avoid purchasing bonds that suffer from illiquidity. Managers may use futures to deal with daily flows. However, the combined weight would be routinely kept below 1% of the fund’s net asset value.

For its suite of physical ETFs, Xtrackers may engage in securities lending. The ETF may lend out a maximum of 50% of its portfolio. Deutsche Bank Agency Securities Lending acts as the lending agent. All transactions are overcollateralized, and the securities taken as collateral tend to be top-rated government bonds and blue-chip stocks. Lending revenue is split 70/30 between the ETF and the lending agent, respectively.

Read Morningstar’s full report on the Xtrackers II Eurozone Government Bond UCITS ETF.

Amundi Index Solutions - Amundi Prime Euro Government Bond UCITS ETF

• Morningstar Medalist Rating
  : Gold
• Morningstar Rating
  : ★★★
• Ongoing Charge: 0.05
• 12 Month Yield: 2.75%

The Amundi Index Solutions - Amundi Prime Euro Government Bond UCITS ETF is run by a management team that earns an Above Average people rating from Morningstar. The team averages around seven years with the fund. Amundi earns a parent rating of Average.

The EUR 1.8 billion fund has dropped 0.39% over the past 12 months, falling less than the average fund in its category, which fell 0.57%. The Amundi fund, which launched in February 2019, has climbed 1.92% over the past three years and lost 2.78% over the past five years.

Amundi uses physical replication to track the performance of the Solactive Eurozone Government Bond Index. For indexes with a small number of liquid components, portfolio managers can use full replication, but otherwise they use stratified sampling. The index is broken down into sections, each representing key risk factors, such as duration, currency, country, rating, and sector. The managers then choose bonds included in the index that mimic the risk profile of each section. The aggregate result is a portfolio that represents the index’s overall risk profile, while allowing the exchange-traded fund manager to avoid purchasing bonds that may suffer from illiquidity.

Read Morningstar’s full report on the Amundi Index Solutions - Amundi Prime Euro Government Bond UCITS ETF.