Bonds in a Rising Interest Rate Environment – Podcast #84
Don't make the classic mistake and assume you know which way bonds are going. Instead, listen to my recommendations about implementing a fixed asset allocation strategy for bonds.
Don't make the classic mistake and assume you know which way bonds are going. Instead, listen to my recommendations about implementing a fixed asset allocation strategy for bonds.
When you decide not to invest in a major asset class like bonds you're making a pretty big bet. In this episode, we examine the reasons for including bonds in your portfolio.
The key to asset allocation is to choose the highest stock-to-bond ratio that you can tolerate without selling out at a market bottom.
Bond ETFs have issues, especially for corporates and munis. If you're going to use a bond fund, stick to a traditional mutual fund. Wealthier investors may wish to buy their treasuries directly.
What kind of bonds should you invest in? William Bernstein says short term individual treasuries. I mostly agree, but there are other considerations.
The Fed has started raising interest rates, and will almost surely continue to do so. What does that mean for your investments, debts, and lifestyle?
Some well-to-do investors buy individual muni bonds instead of a muni bond fund. This former Vanguard bond trader explains why. He argues that you can get better yields and take advantage of an inefficient marketplace if you're willing to give up liquidity.
Money market funds basically pay nothing. Why does anyone still invest in them?
Don't abandon your bonds. They provide a very important counterweight to the stocks in your portfolio.