|
|
Post by mozart522 on Jun 28, 2022 13:20:11 GMT
"Only problem is the fact, that you can buy a guarantee CD/Treasury now for 6-12 months, at 2.5-3% without guessing, so why in the world you need VGSH"
R48 said he "recently made a purchase" back in mid-April. Please tell us what a guaranteed 6-12 month CD/Treasury was going for on April 13th? So maybe today CD/Treasury is a better bet, maybe not in April.
|
|
|
|
Post by retiredat48 on Jun 29, 2022 16:34:25 GMT
"Only problem is the fact, that you can buy a guarantee CD/Treasury now for 6-12 months, at 2.5-3% without guessing, so why in the world you need VGSH" R48 said he "recently made a purchase" back in mid-April. Please tell us what a guaranteed 6-12 month CD/Treasury was going for on April 13th? So maybe today CD/Treasury is a better bet, maybe not in April. Also bought in May and June. Some of these major buys are UP in price. I found it interesting, an interview with a major investment manager (Scott Minerd) state: “fixed income is a great buy, now. It may not be the exact bottom, but six months from now you will be way ahead.” R48 |
|
|
|
Post by Chahta on Jun 29, 2022 16:43:08 GMT
I agree. Just hope it comes to pass. I heard it especially about muni funds. Big money is already projecting to the (most likely) coming recession.
|
|
|
|
Post by chang on Jun 29, 2022 17:16:58 GMT
I found it interesting, an interview with a major investment manager state: “fixed income is a great buy, now. It may not be the exact bottom, but six months from now you will be way ahead.” That may be true. Or it may not be true. You can find a major investment manager who is saying anything you might wish to hear. Personally, I want to see rates get closer to the top. When Fed board members are giving interviews and saying that we need a snap-1% rate increase, I am not ready to buy bonds. |
|
|
|
Post by retiredat48 on Jun 30, 2022 0:45:17 GMT
I found it interesting, an interview with a major investment manager state: “fixed income is a great buy, now. It may not be the exact bottom, but six months from now you will be way ahead.” That may be true. Or it may not be true. You can find a major investment manager who is saying anything you might wish to hear. Personally, I want to see rates get closer to the top. When Fed board members are giving interviews and saying that we need a snap-1% rate increase, I am not ready to buy bonds. Yes indeed, it may or may not happen. But to me, here is how I see it...I will not lose. If rates go up...like to 3.5%, VGSH will be rolling over the constantly maturing bonds(at par) into 3.5% treasuries, increasing the fund dividend yield. If rates go down, like to 2.5%, then the same happens, with VGSH getting slightly LOWER dividend yields, but offset by the underlying bond NAV price increases due lower rates. Yes, this is how the bond rule of thumb works. By limiting the fund to two year treasuries, you do not have to wait long to revert to the mean total return, which is the starting yield when you buy the fund. I submit this will beat money market fund total returns. We shall see. BTW Who are the fed board members saying 1% increase coming? Do you mean former fed board members? To me, when Minerd and Gundlach speak, they should be listened to. I'm simply pointing out this is not my theory, or far out stuff. Many are speaking strongly of Treasuries now, including even longer duration bonds. R48 |
|
|
|
Post by mozart522 on Jun 30, 2022 11:38:29 GMT
retiredat48, Another possible reason for treasuries is if we go into recession, Treasuries are usually where a lot of the money coming out of equities goes. That may be quite a while down the road though.
|
|
|
|
Post by FD1000 on Jun 30, 2022 12:09:55 GMT
R48, Let's make it simple. A typical investor wants to make more than MM and is willing to hold for 6-12 or 24 months. Treasury for 6-12 months NOW are at 2.45-2.9% at Fidelity. CD for 2 years are at 3.3% What should a typical investor do today? Buy treasury(or CD) with a guarantee of performance with no volatility or VGSH? Attachments:
|
|
bf22
Commander
Posts: 135
|
Post by bf22 on Jun 30, 2022 21:32:38 GMT
There is no typical investor. I believe this thread is about making more than MM but not tie up the money for 2 years.
IMO, if this is only for a portion of a portfolio, the additional return over a MM isn't worth the effort. But I do think it's a valid option.
Good investing..
|
|
|
|
Post by FD1000 on Jul 7, 2022 19:31:08 GMT
There is no typical investor. I believe this thread is about making more than MM but not tie up the money for 2 years. IMO, if this is only for a portion of a portfolio, the additional return over a MM isn't worth the effort. But I do think it's a valid option. Good investing.. Rates are pretty nice already for 6-9-12 months treasuries, from 2.6% to almost 3%. This is double of MM, with no risk or volatility. Attachments:
|
|
|
|
Post by fishingrod on Jul 29, 2022 10:27:54 GMT
That may be true. Or it may not be true. You can find a major investment manager who is saying anything you might wish to hear. Personally, I want to see rates get closer to the top. When Fed board members are giving interviews and saying that we need a snap-1% rate increase, I am not ready to buy bonds. Yes indeed, it may or may not happen. But to me, here is how I see it...I will not lose. If rates go up...like to 3.5%, VGSH will be rolling over the constantly maturing bonds(at par) into 3.5% treasuries, increasing the fund dividend yield. If rates go down, like to 2.5%, then the same happens, with VGSH getting slightly LOWER dividend yields, but offset by the underlying bond NAV price increases due lower rates. Yes, this is how the bond rule of thumb works. By limiting the fund to two year treasuries, you do not have to wait long to revert to the mean total return, which is the starting yield when you buy the fund. I submit this will beat money market fund total returns. We shall see. BTW Who are the fed board members saying 1% increase coming? Do you mean former fed board members? To me, when Minerd and Gundlach speak, they should be listened to. I'm simply pointing out this is not my theory, or far out stuff. Many are speaking strongly of Treasuries now, including even longer duration bonds. R48 A tip of the hat and a bow goes to retiredat48 , A good move on his part. It seems his plan is coming together.
VGSH SEC yld now at 3.02%. Up 1.35% in price since 6/14/2022, his last buy.
Market projections are now, a 50bps hike in Sept., a 25bps hike in Nov., and a 25bps hike in Dec.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Jul 29, 2022 10:29:15 GMT
Yes - and would be interested to hear more from R48 on his plan.
|
|
|
|
Post by mozart522 on Jul 29, 2022 11:50:22 GMT
I bought VCSH at 4.03% yield, up .47% yesterday. Seems like a good "no lose" fund as it is a pretty deep discount at 97.7. Still buying t-Bills up to 6 months.
|
|
|
|
Post by chang on Jul 29, 2022 12:41:35 GMT
I just compared VGSH (VSBSX) against RPHIX over every time period. Hmm... no contest. RPHIX is less volatile and has better returns.
|
|
|
|
Post by Fearchar on Jul 29, 2022 13:23:21 GMT
I just compared VGSH (VSBSX) against RPHIX over every time period. Hmm... no contest. RPHIX is less volatile and has better returns. It is a great fund, but the problem is that RPHIX is closed to new investors (at least in my primary account). |
|
|
|
Post by fishingrod on Jul 29, 2022 13:38:29 GMT
I just compared VGSH (VSBSX) against RPHIX over every time period. Hmm... no contest. RPHIX is less volatile and has better returns. VSBSX is more interest rate risk sensitive, but RPHIX is more credit rate sensitive. It shows when looking at March 2020 when RPHIX dipped(3.16%) but VSBSX gained +2.41%.
So if we go into a recession RPHIX may suffer again. Yes it was a blip but it was still there.
|
|
|
|
Post by retiredat48 on Jul 29, 2022 14:16:22 GMT
Yes indeed, it may or may not happen. But to me, here is how I see it...I will not lose. If rates go up...like to 3.5%, VGSH will be rolling over the constantly maturing bonds(at par) into 3.5% treasuries, increasing the fund dividend yield. If rates go down, like to 2.5%, then the same happens, with VGSH getting slightly LOWER dividend yields, but offset by the underlying bond NAV price increases due lower rates. Yes, this is how the bond rule of thumb works. By limiting the fund to two year treasuries, you do not have to wait long to revert to the mean total return, which is the starting yield when you buy the fund. I submit this will beat money market fund total returns. We shall see. BTW Who are the fed board members saying 1% increase coming? Do you mean former fed board members? To me, when Minerd and Gundlach speak, they should be listened to. I'm simply pointing out this is not my theory, or far out stuff. Many are speaking strongly of Treasuries now, including even longer duration bonds. R48 A tip of the hat and a bow goes to retiredat48 , A good move on his part. It seems his plan is coming together.
VGSH SEC yld now at 3.02%. Up 1.35% in price since 6/14/2022, his last buy.
Market projections are now, a 50bps hike in Sept., a 25bps hike in Nov., and a 25bps hike in Dec.
BTW I think you and another poster owes me an ice cream cone, on the bet whether or not the 2 yr treasury rates rise (your position), or not (mine), after the fed increases its rate by 75 bps Wednesday. Rate actually fell!! Some notes: For the third straight time when the fed increased rates, buying the 2 yr treasury the "day before" the announcement was better, as you got a higher yield, and a price increase after the fed actual announcement...and lower yield. There are other similar 2 yr short term bond funds, such as corporates, that may have a higher yield. I selected the treasury bonds as being less sensitive to credit risk, as we enter the recession. Treasuries are also typically a "safe-haven" if the stock market falls a lot. BTW fishingrod...is that "InsiderTrading" site OK to subscribe to?? Jeez...a daily report on 2yr/VGSH! More comments to Sara below... R48 |
|
|
|
Post by fishingrod on Jul 29, 2022 14:20:27 GMT
retiredat48 , What flavor would you like?
I have not subscribed. So I couldn't tell you, but it seems legit.
|
|
|
|
Post by chang on Jul 29, 2022 14:33:52 GMT
I just compared VGSH (VSBSX) against RPHIX over every time period. Hmm... no contest. RPHIX is less volatile and has better returns. VSBSX is more interest rate risk sensitive, but RPHIX is more credit rate sensitive. It shows when looking at March 2020 when RPHIX dipped(3.16%) but VSBSX gained +2.41%.
So if we go into a recession RPHIX may suffer again. Yes it was a blip but it was still there. Myesss..... what you say is absolutely true. The 3Y chart illustrates your point. But over a longer time period (actually, over almost all time periods), I still prefer the chart of RPHIX.  |
|
|
|
Post by retiredat48 on Jul 29, 2022 14:37:36 GMT
Yes - and would be interested to hear more from R48 on his plan. Hi...First, I am not a bond expert...just 50 years of following same. I would say it is a strategy versus a plan...goes like this: I find I now have the largest "cash position" in my investing history, coming primarily from large standard-issue bond fund liquidations a year or two ago. This cash was earning zilch in interest for awhile. In seeking a cash haven whereby I could increase yield. I concluded the two year treasury bond was a good place. The convincing was bond manager J. Gundlach showing chart curves and stating the fact that the fed funds rate follows the two year tr yield at good correlation. Gundlach recommended 2 yr at a yield just below 2%. Then fed soon made public it was going 75 versus 50 bp a month ago, and it did. This 25bp more was added into the 2 yr expectations. . I started this threa. Came to pass the two yr yield got above 3%. Since the fed has repeatedly stated their goal is 3% by end 2022, and maybe to 3.5% next year, this seemed the two year had overshot its yield for now. That buying now, a capital gain would also be achieved if held to 6 months to a year, as any recessions or slowdown may limit the fed increase, or actually anticipate fed reducing next year. This seems to be happening now. My experience is that yields will fluctuate around a base point. Powell recently called 2.5% the "neutral rate", a surprise he said that. So at 3%, 2 yr tr has a good yield, and I expect it to fluctuate between 2.5% and 3.25%. If it hits 2.5% (VGSH will be up more in price), I may sell, and wait. Just taking advantage of opportunity. I'm not a trader. But all duration Tr bonds seem hovering around 3% max--market is bearish on economy/recessions etc. We will see. Bigger decision is where/when to deploy this cash...for the long run...both stock and bond funds. R48 |
|
|
|
Post by mozart522 on Jul 29, 2022 16:55:38 GMT
retiredat48, The discussion was about VGSH, not the 2 year bond. If I buy a 2 year bond today I get about 3% annual and my distributions will reflect 3% annual. VGSH has an average coupon of 1.4% and a 3% return depends on essentially all the bonds being held to maturity and 3% is the yield to maturity. A two year bond is a bird in the hand. VGSH is just one in the bush. You have complicated and confused the issue some by bringing up the 2 year bond. Your stated intent was to get more than MM return for use of your cash. I agree you will likely get that, but your holding period is uncertain and must be timed just right. You can buy 3 or 6th month T-bills and be guaranteed to get to do better than cash and the period is certain. This was what FD and I were suggesting.
|
|
|
|
Post by fishingrod on Jul 29, 2022 19:56:23 GMT
retiredat48 , I will still buy you an ice cream cone, but I did not say you were wrong. I said one should not assume that VGSH will not go down when rates rise. It Could have gone either way depending on economy and inflation concerns.
You have taken a calculated risk and it has been OK-------- so far.
|
|
|
|
Post by retiredat48 on Jul 29, 2022 20:19:44 GMT
mozart522 ,...I agree, I go back and forth discussing the 2 yr treasury bond and VGSH. Yes, VGSH was my selection, but I have posted I am entirely OK with others buying treasury direct, actual bonds...and using ladders if desired. Look, I posted how over the years I almost always took the longer-duration, higher yield, and let NAV float, as opposed to the "safety" of MM or shorter term bond funds. And that on balance I came out ahead. Not for everyone, but by introducing this concept, some others will do same. (I did not use this tactic in last couple years as LT bond rates artificially low--too risky.) I expect to be back in business soon with longer maturity bond funds, corporates, and perhaps junk bonds. fishingrod ,...I like " Cherry Garcia" flavor...check that-- Ben & Jerry are too liberal. I'll take "Peachy Paterno"...a Penn State Ice cream from the student Creamery!! Those Ag students know how to make things creamy. BTW Ben and Jerry learned to make ice cream from a Penn State correspondence course!! Every day, I took my eventual spouse back to her North Halls dorm, then go to the creamery for a 20 cent cone, then walk back to the frat house...in that order!! Here is ice cream flavor-heaven: creamery.psu.edu/ice-cream/all-flavorsR48
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Jul 29, 2022 21:20:33 GMT
.................. fishingrod ,...I like " Cherry Garcia" flavor...check that-- Ben & Jerry are too liberal. I'll take "Peachy Paterno"...a Penn State Ice cream from the student Creamery!! Those Ag students know how to make things creamy. BTW Ben and Jerry learned to make ice cream from a Penn State correspondence course!! Every day, I took my eventual spouse back to her North Halls dorm, then go to the creamery for a 20 cent cone, then walk back to the frat house...in that order!! Here is ice cream flavor-heaven: creamery.psu.edu/ice-cream/all-flavorsR48 OT: R48 is emphatically correct here about The Creamery at Penn State !! Glad he showed a link to the flavor-heaven .... but this is one area where you don't pyramid-up if you value your health. What isn't shown is the super-large flavor quantity. A single-scoop here is easily 3+ that you would get at Baskin-Robbins. The "Death by Chocolate" flavor is aptly named. --- Frank (partner's daughter is on the PSU Nursing faculty) |
|
|
|
Post by mozart522 on Jul 29, 2022 22:04:47 GMT
mozart522 ,...I agree, I go back and forth discussing the 2 yr treasury bond and VGSH. Yes, VGSH was my selection, but I have posted I am entirely OK with others buying treasury direct, actual bonds...and using ladders if desired. Look, I posted how over the years I almost always took the longer-duration, higher yield, and let NAV float, as opposed to the "safety" of MM or shorter term bond funds. And that on balance I came out ahead. Not for everyone, but by introducing this concept, some others will do same. (I did not use this tactic in last couple years as LT bond rates artificially low--too risky.) I expect to be back in business soon with longer maturity bond funds, corporates, and perhaps junk bonds. fishingrod ,...I like " Cherry Garcia" flavor...check that-- Ben & Jerry are too liberal. I'll take "Peachy Paterno"...a Penn State Ice cream from the student Creamery!! Those Ag students know how to make things creamy. BTW Ben and Jerry learned to make ice cream from a Penn State correspondence course!! Every day, I took my eventual spouse back to her North Halls dorm, then go to the creamery for a 20 cent cone, then walk back to the frat house...in that order!! Here is ice cream flavor-heaven: creamery.psu.edu/ice-cream/all-flavorsR48 I bought VCSH recently and FALN (fallen angels JB) yesterday. I agree, longer intermediates will eventually be my go to also also. I'd like to see some up around 5% so when the rate cutting starts, prices will rise. I don't like treasury direct and buy T-bills through Vanguard. |
|
|
|
Post by mozart522 on Jul 29, 2022 22:12:09 GMT
retiredat48 , I will still buy you an ice cream cone, but I did not say you were wrong. I said one should not assume that VGSH will not go down when rates rise. It Could have gone either way depending on economy and inflation concerns. And it still could. A rise in the FED rate is not immediately a rise in the 2 year. There is a lag and as you say other potential pressures up or down. |
|
|
|
Post by FD1000 on Jul 30, 2022 0:02:07 GMT
The problem is, I actually read all posts from the OP and someone keeps changing the narrative as we go. 3/23 (OP):Quote: "I also expect the ten year Treasury to peak around 2.6%"......FD: it picked at 3.5% If you invested in the next 10 weeks after the OP, you hardly made or no money. 10 weeks is a long time for something that suppose to happen. 3/24:
Quote: "if Gundlach considered the 2 year a "buy" at 1.92%, then at 2.16% it is likely even a better buy"...FD: I have said that waiting was a better choice and we will see better options for average Joe and traders. The 2 years got to 3% and that's a lot higher than 2.16% QUOTE: BOND RULE OF THUMB. Which is: If you buy a bond fund and hold to its duration (linked to maturity), your total return will closely approximate the starting yield, REGARDLESS OF THE DIRECTION OF INTEREST RATES.... FD: that rule was debunked in volatile/risky markets. We had several posts about it. Then came mid June, it was a good call FOR A TRADER to buy VGSH. But, at the same time, the 1-year treasury paid about 2.9 and 2 years of 3+% (see my post from June 17( link). It was a much better deal for anyone, ESPECIALLY FOR A MM SUB(this thread was started based on this): no volatility, only one year until things get better, guarantee 2.9%, no more trading small %...or...just invest for 2 years. Easy call, someone did not acknowledge it back then.I also said that if you are a trader, why would you go for low performance and very high volatility in bond land, especially ST bond fund. Just wait, opportunities will come and they came swinging out of the park. So, let's summarize: 1) Buying VGSH for 10 weeks wasn't a good idea 2) When rates finally went up, it was a good idea to buy VGSH, but buying 1-year treasury was a much better risk-adjusted idea (actually the risk in minimal). When you talk about a good sub for MM/CASH there is no contest. I learned a lot about CD/treasuries. That was a big plus. I still didn't own any. As a trade, I like SHM=SH Muni over VGSH, see chart below. Better performance, lower volatility. Well, Munis are usually my top category, coming from the bottom. They are "safer" than Multi and have less rate risk than treasury. BTW, the Fed chair blinked, and why stocks and bonds did well. He may change his tune but now it's base more on the data then raising rates regardless. Attachments:
|
|
|
|
Post by archer on Jul 30, 2022 0:13:06 GMT
Every day, I took my eventual spouse back to her North Halls dorm, then go to the creamery for a 20 cent cone, then walk back to the frat house...in that order!! R48 Those prices from way back when show the power of compounding an average inflation of only 2-3% I found a menu in my mother's scrap book from when she was in her late teens, (mid 1930's). If only I could find a time portal to squeeze me and my PF through! |
|
|
|
Post by retiredat48 on Jul 30, 2022 13:19:00 GMT
Every day, I took my eventual spouse back to her North Halls dorm, then go to the creamery for a 20 cent cone, then walk back to the frat house...in that order!! R48 Those prices from way back when show the power of compounding an average inflation of only 2-3% I found a menu in my mother's scrap book from when she was in her late teens, (mid 1930's). If only I could find a time portal to squeeze me and my PF through! I was a "snow bird" for 29 years...going back and forth, FL to NY, seasonally. I kept breakfast menu's from my fav Farmer Dicks farm /restaurant...shows price increases that are more than gvt inflation stats. When I started in FL, I got breakfast specials for $1.39. Now more like senior menu...$7.99. Yesterday I splurged and got a western omelet with pancakes, and it was new price: $14.99; coffee $3.25; tip about $3.50. Last time I venture from the senior menu. BTW in FL everytime you buy something, you have to ask for "senior discount pricing." Hundreds of name places offer it. Like, Dairy Queen cone...10% off. Got that fishingrod! R48 |
|
|
|
Post by retiredat48 on Jul 30, 2022 13:52:04 GMT
The problem is, I actually read all posts from the OP and someone keeps changing the narrative as we go. 3/23 (OP):Quote: "I also expect the ten year Treasury to peak around 2.6%"......FD: it picked at 3.5% If you invested in the next 10 weeks after the OP, you hardly made or no money. 10 weeks is a long time for something that suppose to happen. R48 replies in bold...I keep repeating, I did not buy at the original post time. Sara has corrected you on this.3/24:
Quote: "if Gundlach considered the 2 year a "buy" at 1.92%, then at 2.16% it is likely even a better buy"...FD: I have said that waiting was a better choice and we will see better options for average Joe and traders. The 2 years got to 3% and that's a lot higher than 2.16% That's why we live in real time. Real time was that after the Gundlach recommendation, the fed soon made public it was increasing the fed rate by 75 bp's instead of fifty bp. The market immediately incorporated in this pivot. So did I. I then felt the 2 yr treasury overshot and was going too high. Turned out to be the case.
QUOTE: BOND RULE OF THUMB. Which is: If you buy a bond fund and hold to its duration (linked to maturity), your total return will closely approximate the starting yield, REGARDLESS OF THE DIRECTION OF INTEREST RATES.... FD: that rule was debunked in volatile/risky markets. We had several posts about it. NO, the rule has not been debunked. If you bought A BOND FUND when Gundlach suggested, AND HOLD FOR THE 2 YEAR DURATION, YOU GET YOUR STARTING RATE RETURN. SAME AS IF ONE BOUGHT AN ACTUAL 2 YR TREASURY BOND. Why are you having such difficulty seeing this? Readers, if you have one takeaway, it is the value of the "bond rule of thumb" in making bond fund purchases. You do not have to catch "peaks".Then came mid June, it was a good call FOR A TRADER to buy VGSH. R48: Woa! You are acknowledging it was a good buy time! I am not a trader. This thread is about investing CASH. By definition one exits cash at some time. I have not sold any yet. BTW I bought some for my brother's transition to retirement portfolio, that will be kept as an investment. Thus no "trading" involved. He needs 3% to get by in retirement. But, at the same time, the 1-year treasury paid about 2.9 and 2 years of 3+% (see my post from June 17( link). It was a much better deal for anyone, ESPECIALLY FOR A MM SUB(this thread was started based on this): no volatility, only one year until things get better, guarantee 2.9%, no more trading small %...or...just invest for 2 years. Easy call, someone did not acknowledge it back then.
I repeat...I plan to have more total return in 6 months to one year, than any of these others...and that is on track. And I don't buy it that investing in short duration treasuries has much risk.
I also said that if you are a trader, why would you go for low performance and very high volatility in bond land, especially ST bond fund. Just wait, opportunities will come and they came swinging out of the park. Oh yea, where are these opportunities?...rates now hit a wall at 3%, across all maturities. This investment is for "cash." I can change to someting else, on a dime!So, let's summarize: 1) Buying VGSH for 10 weeks wasn't a good idea It wasn't bought 10 weeks ago. I bought in buckets, over this period. My statement shows a very positive dollar gain.
2) When rates finally went up, it was a good idea to buy VGSH, but buying 1-year treasury was a much better risk-adjusted idea (actually the risk in minimal). When you talk about a good sub for MM/CASH there is no contest. Commented on above. Your tombstone better have "risk-adjusted" on it when you pass!  I learned a lot about CD/treasuries. That was a big plus. Good. That's why this thread was started.I still didn't own any. As a trade, I like SHM=SH Muni over VGSH, see chart below. Better performance, lower volatility. Well, Munis are usually my top category, coming from the bottom. They are "safer" than Multi and have less rate risk than treasury. A ll my money is in IRAs...so muny's generally not attractive to me.BTW, the Fed chair blinked, and why stocks and bonds did well. He may change his tune but now it's base more on the data then raising rates regardless. My experience predicted this...hence the buying. Raising rates has real ramifications on society...such as the fastest increase in mortgage rates of all time. Severe impact underway. I expect fed will not make all its predicted increases (25-50 bps) remaining this year, especially around election time...and XMAS. It's what makes a market.
BTW There is one thing I made a small mistake on...I knew the bond prices fall this year was about the fastest in history. I did not realize that VGSH would have such a low divy yield, under 1%, needing to catchup (SEC published yield was much higher). Treasury direct purchase probably better. However, as discussed in this thread, you get a daily accrual of cap gain price increases as VGSH catches up by rolling over maturing bonds(now selling below par). But this requires holding a few months or quarters longer. But if one needed cash quickly, owning the bonds oneself would have been somewhat better.
R48 in bold |
|
|
|
Post by chang on Jul 30, 2022 14:34:17 GMT
Don’t misunderstand this, but … it sure seems like a lot of discussion and analysis for an investment that pays peanuts. I’m seeing a lot of interesting opportunities in equities — of course that’s an entirely different kettle of fish, with greater risk and reward. Nevertheless, yesterday AMZN was up 10% and BABA was down 10%, so all you had to do was buy the former and short the latter, and you would have made in one day the same amount you’ll make from a S/T bond fund in 15 years. I’m not saying that I was smart enough to do that, but there were some fairly easy signals to read from RIO and UBS the last couple weeks that allowed me to pocket an easy 5-10%. It’s JMHHHO but I’m happy leaving my bond money in RPHIX until rates top out, and focus on more interesting opportunities. Once again, no disrespect or denigration intended toward anyone who wants to submerge themselves in bond analysis — I respect that totally (that, after all, is what RPHIX manager David Sherman gets paid to do) — just offering another viewpoint.
|
|
