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Post by chang on Apr 23, 2024 9:16:47 GMT
Had three big T-bills maturing, the first in January, the next two coming up shortly. The plan was to roll into FTBFX and ride the interest rate cuts.
After I lost about $2k on FTBFX I switched over to FBNDX to capture a tax loss. Now I’m down another $6k and considering switching back over to FTBFX.
This is marvelous, I can just keep switching back and forth every month and book $72k of tax losses a year, hooray!
At this stage, should I throw it all back into MM, or just close my eyes, hold my nose, and hang on?
(The upcoming T-bills are going into MM for sure.)
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Post by yogibearbull on Apr 23, 2024 11:31:21 GMT
M-Mkt or ultra-ST USFR.
As posted elsewhere, Treasury FRN USFR uses 2-yr Treasury FRNs that RESET rates every TUESDAY to 3-mo T-Bills, following the MONDAY Auction (except for holidays). So, that is a convenient way to track 3-mo T-Bills at 15 bps. There is also some fixed rate bps at FRN issue.
Extending bond maturities gradually is a good idea at this time, but it can be frustrating.
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Post by fishingrod on Apr 23, 2024 12:26:27 GMT
Does it matter if you buy right before the dividend on USFR? It looks like the interest is accruing daily in it's price.
Thanks.
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Post by yogibearbull on Apr 23, 2024 13:12:48 GMT
fishingrod , it is better to buy USFR on/after the ex-div date to avoid tiny tax hit for distribution. Unlike mutual funds with daily accrual (but paid monthly), all ETFs flow distributions via NAV. You can see a sawtooth pattern at StockCharts. I don't bother with this and use USFR for transactions as needed. stockcharts.com/h-perf/ui?s=USFR&compare=_USFR&id=p79011986717
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Post by Chahta on Apr 23, 2024 13:39:48 GMT
Had three big T-bills maturing, the first in January, the next two coming up shortly. The plan was to roll into FTBFX and ride the interest rate cuts. After I lost about $2k on FTBFX I switched over to FBNDX to capture a tax loss. Now I’m down another $6k and considering switching back over to FTBFX. This is marvelous, I can just keep switching back and forth every month and book $72k of tax losses a year, hooray! At this stage, should I throw it all back into MM, or just close my eyes, hold my nose, and hang on? (The upcoming T-bills are going into MM for sure.) Personally I don't get the reluctance to buy good bonds funds at depressed prices. Interest accrues and provides a stronger recovery waiting for rates to be cut. I got beat up in the 2020 black swan and learned my lesson. I have been buying good funds since 2022 and want to establish a low-cost basis for income production. RMDs start next year for me and I will use interest and divs for that. Max portfolio growth is over for me. However OSTIX, RSIIX and CBLDX have done nothing but make money the last 1 1/2 years. The IT funds will take longer with this current 10-year rate increase. I say hang on. I like that tax loss. |
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