marg
Ensign
Posts: 34
|
Post by marg on Jan 4, 2024 16:00:44 GMT
any opinion? Thank you
|
|
|
Post by racqueteer on Jan 4, 2024 16:29:11 GMT
I think one would have to ask, to replace what and for what purpose? If you think rates will drop soon and maybe you would be wise to move from, say, 3 month Treasuries, my reply would be that you might be a little early (or maybe even late as some have locked in longer duration assets already). Anyway, the motivation for the move and the source of the investment would be relevant.
|
|
marg
Ensign
Posts: 34
|
Post by marg on Jan 4, 2024 16:49:55 GMT
I have a lot of T bill to mature soon25% and my bond fund is 19% equities 54%
|
|
|
Post by steelpony10 on Jan 4, 2024 17:19:08 GMT
marg , As racqueteer , mentioned what’s the purpose of any of your holdings. I look at an investing plan as a puzzle with in your case a piece is about to be removed. Find a piece to replace it. Your T bills were a cash like holding if seems? Another cash like holding? New T bills? Laddered CD’s? A VWAHX like tax free muni fund? If you want to do what you mentioned in your post then now is a good time as any to do that. Posing a market timing question is factually a poor long term investing technique which apparently amateurs have a hard time accepting as fact.
|
|
|
Post by Chahta on Jan 4, 2024 17:38:55 GMT
In my mind it is still a good time to buy. But the prime time was last year when rates were higher. For some reason investors get spooked about bonds, wanting to time them more than stocks. Both funds mentioned had nice TRs last year.
|
|
marg
Ensign
Posts: 34
|
Post by marg on Jan 4, 2024 18:02:33 GMT
I'm still a novice at investing, so prefer index. I plan/have 60/40 equities/bond, hold VTSAX, VUG, VIG, MGK and need to put some in bonds for safety(40%)or buffer, so I opted these 2 bond fund , but maybe VWALX is good in my taxable acct?
|
|
|
Post by chang on Jan 4, 2024 18:26:04 GMT
I'm in a similar posish; see a similar thread I started a week or so ago: big-bang-investors.proboards.com/thread/2926/bill-maturing-11-invest-whereAssuming you are not looking to change your AA, but simply play a little more offense in the FI space than T-Bills [my situation], I decided the answer was "yes". I have three T-Bills maturing, all in taxable accounts. Two at Fido will go into FTBFX (and maybe some BINC); one at VG will go into VWALX. Personally, I think active management (as long as expenses stay under ~0.5%) pays for itself. It's easy enough to conclude by comparing charts (eg BND vs. FBND). Note: I am not looking to trade here. I think I missed most of the NAV rise last year due to bonds having been oversold. I am looking for a good LT vehicle to generate income and navigate falling rates over the coming years.
|
|
|
Post by racqueteer on Jan 4, 2024 18:38:42 GMT
Ok, so if I'm understanding correctly, this is taxable money from maturing T-bills, and you want to maintain a 60-40 allocation mix long-term? Are you looking for something which would minimize state taxes (municipals)? Do you want this money to be 'safe' or are you willing to take small risk for potentially more gain?
You could do any of the things @steelpony 10 mentioned. You could use a moderate allocation fund for stocks and bonds. You could even use an etf like USFR while things settle out. It's quiet, safe, and beats most savings accounts.
|
|
marg
Ensign
Posts: 34
|
Post by marg on Jan 4, 2024 19:38:11 GMT
racqueteer, It is for taxable and IRA acct. but majority of $ is for taxable acct and also I'm looking to minimize state taxes. Currently I have some $ in VUSXX (5.32%) and manage to deduct % in my state taxes to get refund. FI, I want 50% of money to be "safe" and 50% for more gains.
|
|
|
Post by fishingrod on Jan 4, 2024 20:14:43 GMT
VGSH or VWSUX for safe and VCIT for income gains.
VWEAX or VWIUX or VWALX if you want to go longer and more risk.
Nothing is "safe".
|
|
|
Post by racqueteer on Jan 4, 2024 20:45:32 GMT
Not to be argumentative, but here is a chart of VGSH and USFR. Which would you say is 'safe'?
Attachments:
|
|
|
Post by fishingrod on Jan 4, 2024 20:54:39 GMT
The one on the top?
Just joking. I thought we were looking more at Vanguard funds. I would never argue with you. I believe you are correct that USFR has demonstrated better safeness.
So if you want it safe just leave the money in the settlement fund VMRXX or VUSXX and get tax break.
Or go with USFR. It seems to adjust to rate changes quicker than a money market fund. That could work backward if rates go down. But it is still 'safe'.
|
|
|
Post by yogibearbull on Jan 4, 2024 21:10:41 GMT
USFR is 2-yr Treasury FRNs that pay 3-mo T-Bill rate, reset weekly (Mondays). Of course, minus 15 bps ER. So, it's a ST-Treasury fund with about 1 week duration.
It didn't do well during the ZIRP, as there was no NAV floor like $1 for m-mkt funds. But now it's great.
|
|
|
Post by catdog on Jan 5, 2024 2:00:28 GMT
Marg,
BND is passively managed. FBND is actively managed. Vanguard offers active management at somewhat low er's. Keep in mind that FBND currently is holding approximately 13% junk bonds. BND only delves in BBB rated bonds for excitement.
As far as Active/Passive management, many (maybe not all) on this board believe passive better suited for equities and active better suited for bonds.
catdog
|
|
|
Post by mozart522 on Jan 5, 2024 13:20:18 GMT
Marg, BND is passively managed. FBND is actively managed. Vanguard offers active management at somewhat low er's. Keep in mind that FBND currently is holding approximately 13% junk bonds. BND only delves in BBB rated bonds for excitement. As far as Active/Passive management, many (maybe not all) on this board believe passive better suited for equities and active better suited for bonds. catdog FBND is core-plus fund, BND is investment grade fund. It should do better active or not.
|
|
|
Post by mnfish on Jan 5, 2024 14:26:15 GMT
MMs are paying +5% and some of these bond funds are up 8-10% since Oct, still pay less than 4%, and the Fed hasn't done anything other than signal a "possible" cut(s). Even if the Fed does cut .75% by June(?) how much more can they go up? Doesn't it seem the possible cuts are already in their prices?
|
|
|
Post by chang on Jan 5, 2024 14:30:36 GMT
Marg, BND is passively managed. FBND is actively managed. Vanguard offers active management at somewhat low er's. Keep in mind that FBND currently is holding approximately 13% junk bonds. BND only delves in BBB rated bonds for excitement. As far as Active/Passive management, many (maybe not all) on this board believe passive better suited for equities and active better suited for bonds. catdog FBND is core-plus fund, BND is investment grade fund. It should do better active or not. FIGB is the active IG brother of FBND. (Thanks yogi for pointing out the typo.)
|
|
|
Post by yogibearbull on Jan 5, 2024 15:13:15 GMT
|
|
|
Post by fishingrod on Jan 5, 2024 17:00:40 GMT
MMs are paying +5% and some of these bond funds are up 8-10% since Oct, still pay less than 4%, and the Fed hasn't done anything other than signal a "possible" cut(s). Even if the Fed does cut .75% by June(?) how much more can they go up? Doesn't it seem the possible cuts are already in their prices?
They may not go up much from here but should provide income and hopefully a 'ballast' position for one's portfolio.
|
|
|
Post by bb2 on Mar 6, 2024 18:13:31 GMT
Looks like it's happening now.
|
|