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Talk about all common (i.e. non-personal) investing questions and points, investing information, and concept.
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Sell Total bond fund (BND) to fund TIPS ladder
Does it make sense to promote Complete bond fund (BND) to fund a 20 yr TIPS ladder.
Actual TIPS common curiosity is about 1.69% and BND is down for me about -7.52% from its excessive of Aug 2020. Options?
Re: Sell Total bond fund (BND) to fund TIPS ladder
Vastly extra information is required. What are your targets? Your age? Your earnings, asset allocation, wealth, and many others.
Your speaking about belongings with completely different targets. A bond fund is supposed to provide low volatility returns. They’re usually used to as an uncorrelated asset with shares to clean out returns. A suggestions ladder is supposed to supply very particular actual quantities over a particular timeframe, sometimes as a bridge to retirement or a method to assure some minimal earnings in retirement.
41% VTSAX, 35% VTIAX, 4% VSIAX, 20% VSIGX. 80/20 S/B, 57/43 US/INT, 10% of US holdings allotted to small-cap worth. All bonds are US treasuries.
Re: Sell Total bond fund (BND) to fund TIPS ladder
You additionally appear to assume that TIPS can not lose cash. That’s not true.
This signature message sponsored by sscritic: Study to fish.
Re: Sell Total bond fund (BND) to fund TIPS ladder
It is smart in some conditions.
What are your causes for proudly owning bonds in your portfolio?
What would a TIPS ladder do for you that BND or TIPS bond fund would not assist with?
Re: Sell Total bond fund (BND) to fund TIPS ladder
For me the reply was to have each. When actual yields went over 2% I invested 10% in a suggestions ladder. I am prepared to go to fifteen% if yields keep close to 2%. I additionally personal BND although. I in all probability have 5% now however my goal is 10%. For the person suggestions I am prepared to carry them to maturity so I do not care if charges rise once more. If charges had been to fall near 0 once more I am going to in all probability promote. In any other case I am going to money them as they mature. Getting 2% + inflation looks as if a superb deal to me.
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Re: Sell Total bond fund (BND) to fund TIPS ladder
I don’t belief measured inflation; that’s the reason I’m in nominal bonds solely. BND had a 5% come again within the final 3 months. Watch out of a market timing transfer that might lock in your losses.
Previous consequence doesn’t predict future efficiency. Talked about investments might lose cash. Contents are introduced “AS IS” and any implied suitability for a specific function are disclaimed.
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Re: Sell Total bond fund (BND) to fund TIPS ladder
Vital bandwidth on this website been dedicated to that matter, particularly TIPS fund versus TIPS bond ladder. On BH, TIPS ladders are all however mentioned in hushed quasi-religious tones. 
Retirement is greatest when you will have quite a bit to reside on, and quite a bit to reside for. * None of what I put up is funding recommendation.* |
FIRE’d July 2023
Re: Sell Total bond fund (BND) to fund TIPS ladder
AlwaysLearningMore wrote: ↑Solar Sep 08, 2024 9:06 pmVital bandwidth on this website been dedicated to that matter, particularly TIPS fund versus TIPS bond ladder. On BH, TIPS ladders are all however mentioned in hushed quasi-religious tones.
Sure certainly 
Although the aim of my query was for the OP to assume issues via and work out how or even when TIPS are one thing he wants.
Re: Sell Total bond fund (BND) to fund TIPS ladder
Charges had been close to zero in 2020, market charges for bonds charges went up, end result would have been comparable holding suggestions of an identical length
Re: Sell Total bond fund (BND) to fund TIPS ladder
Why are you asking?
International shares, IG/HY bonds, gold & digital belongings at market weights 75% / 19% / 6% || LMP: TIPS ladder
Re: Sell Total bond fund (BND) to fund TIPS ladder
BND was up 5.7% in 2023, and is up 3.1% up to now this yr. I do not see the purpose in fixating on 2022, which noticed an increase from all-time-low rates of interest.
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Re: Sell Total bond fund (BND) to fund TIPS ladder
For those who’re buying and selling a bond fund for a ladder of roughly comparable length, there isn’t any market timing concerned. You will get the identical value motion on both finish. You might be altering your publicity to sudden inflation price modifications, simply not price modifications.
Re: Sell Total bond fund (BND) to fund TIPS ladder
The enchantment of TIPS ladders is that they supply assured actual returns at maturity. The worth of the bonds within the ladder will range with rates of interest earlier than maturity however you already know precisely what the actual worth shall be on the finish for every bond.
Funds wouldn’t have this property. Since they by no means mature, there’s by no means a degree when the long run actual worth is thought. Not even for a TIPS fund.
After all not everyone seems to be seeking to lock in specified actual returns for years into the long run. Many individuals maintain bonds or bond funds to cut back the volatility of a portfolio that additionally holds shares. These folks need decrease variance in returns from a asset with low correlation with shares. Funds may be the best instrument for this.
We do not know easy methods to beat the market on a risk-adjusted foundation, and we do not know anybody that does know both |
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We assume that markets are environment friendly, that costs are proper |
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