Please be kind ....Newbie with a question
Please be kind ....Newbie with a question
Please no lectures on "Why did you buy them in the first place dummy?' I just need a little advice.
A few months ago, I bought about 25K of VSIGX (Intermediate term treasury bond fund) and so far have lost about 1K of value. I also purchased about 20K of VLGSX (Long term treasury bond fund) and have lost over 3K so far.
These are in my Vanguard IRA portfolio. My gut told me not to buy bond funds, but I did anyway.
I believe strongly that interest rates are going to rise within the next 1-2 years.
I hate that I have lost over 4K in just a couple months, but feel like it's likely I will lose even more on these two funds if interest rates do indeed rise.
Would you suggest I sell them now and suck up the loss, and invest in some other Vanguard funds? Or just hold onto them, and sell if we happen to get a bear market and their prices go up?
I am a NEWBIE and bonds are something I understand the least. Just not sure of the right move here.
The rest of my portfolio is mixed and I would say balanced to my comfort level.
Thank you in advance!
A few months ago, I bought about 25K of VSIGX (Intermediate term treasury bond fund) and so far have lost about 1K of value. I also purchased about 20K of VLGSX (Long term treasury bond fund) and have lost over 3K so far.
These are in my Vanguard IRA portfolio. My gut told me not to buy bond funds, but I did anyway.
I believe strongly that interest rates are going to rise within the next 1-2 years.
I hate that I have lost over 4K in just a couple months, but feel like it's likely I will lose even more on these two funds if interest rates do indeed rise.
Would you suggest I sell them now and suck up the loss, and invest in some other Vanguard funds? Or just hold onto them, and sell if we happen to get a bear market and their prices go up?
I am a NEWBIE and bonds are something I understand the least. Just not sure of the right move here.
The rest of my portfolio is mixed and I would say balanced to my comfort level.
Thank you in advance!
Re: Please be kind ....Newbie with a question
It is out of the mainstream of BH thought to hold long term treasury funds. Intermediate bond funds are most commonly recommended.
The fund NAV will continue to fall as interest rates rise. If you can't stand the value of your portfolio dropping, I would sell the LT treasuries.
The fund NAV will continue to fall as interest rates rise. If you can't stand the value of your portfolio dropping, I would sell the LT treasuries.
Last edited by David Jay on Fri May 14, 2021 6:34 pm, edited 1 time in total.
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Re: Please be kind ....Newbie with a question
You need to provide your complete portfolio so that we can help you with your question. Otherwise this is too little information to provide good answers. See the sticky post on top and ask your questions using that format
viewtopic.php?f=1&t=6212
viewtopic.php?f=1&t=6212
Re: Please be kind ....Newbie with a question
You will find multiple opinions on bonds here given the interest rate climate.
For me, it’s all about, if I don’t want to be 100% stocks, where am I going to go? All fixed income is bad. So that big slug of bonds is there as a volatility reducer and to guard against sequence of returns risk of a big drop in equities close to retirement.
For me, it’s all about, if I don’t want to be 100% stocks, where am I going to go? All fixed income is bad. So that big slug of bonds is there as a volatility reducer and to guard against sequence of returns risk of a big drop in equities close to retirement.
Re: Please be kind ....Newbie with a question
I generally buy MORE bond fund shares when they drop in value because I have reasonable asset allocation percentage for fixed income (i.e. bonds) in my portfolio.
Re: Please be kind ....Newbie with a question
OP, your loss in a sunken cost, so you should forget it happened. Only be concerned with if you want to hold bonds for the next X years, which you don't seem to.
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Re: Please be kind ....Newbie with a question
How long until RMDs start?
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Re: Please be kind ....Newbie with a question
As someone else pointed out, you've not given any other information about your portfolio. For example, is that 4k "loss" more than offset by gains in stocks? I think the main thing you need to understand about your treasury bond funds (or ANY bond fund) is that the longer the duration, the higher the sensitivity to moves in interest rates. The Investopedia on bond duration is here:
https://www.investopedia.com/terms/d/duration.asp
Check out the part about "modified duration". It looks like VSIGX has a duration of 5.3 years while the duration of VLGSX is about 17.7 years. Understanding bond duration will help you to understand about how much your treasuries will move up or down with a given change in interest rates. Others will probably explain it better.
You've bought some volatile bonds. Whether or not that is a bug or a feature depends on what you are looking for your bonds to do. I think most folks on here want their bonds to act as ballast to their volatile equities but not everyone is in the same boat. Long duration bonds briefly surged in value last March when stocks were getting killed. So, if an investor owned a lot of bonds with a duration of 17-18 years, it could have been an excellent time to sell bonds and buy stocks.
In general, if you want your bonds to be boring and just crawl up in value over time, those long-duration bonds are probably not for you. And, in the grand scheme of things, a 4k loss is a drag but not something you can't overcome.
Good luck!!
https://www.investopedia.com/terms/d/duration.asp
Check out the part about "modified duration". It looks like VSIGX has a duration of 5.3 years while the duration of VLGSX is about 17.7 years. Understanding bond duration will help you to understand about how much your treasuries will move up or down with a given change in interest rates. Others will probably explain it better.
You've bought some volatile bonds. Whether or not that is a bug or a feature depends on what you are looking for your bonds to do. I think most folks on here want their bonds to act as ballast to their volatile equities but not everyone is in the same boat. Long duration bonds briefly surged in value last March when stocks were getting killed. So, if an investor owned a lot of bonds with a duration of 17-18 years, it could have been an excellent time to sell bonds and buy stocks.
In general, if you want your bonds to be boring and just crawl up in value over time, those long-duration bonds are probably not for you. And, in the grand scheme of things, a 4k loss is a drag but not something you can't overcome.
Good luck!!
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Re: Please be kind ....Newbie with a question
The 5 year treasury started the year 2013 at 0.76 and finished the year at 1.76. Rising rates led to a total return for VSIGX for the year 2013 of -2.74%. By Oct 2014, it had fully recovered the loss.
I cannot find any purchase date for VSIGX this year from which its total return is down 4%. Are you sure you are including interest payments in your return estimate?
VSIGX is a good core holding for bonds. I'm not enamored with long-term treasuries. There are some on here who recommend and hold them. To do so, you have to have a long holding period, at least as long as the fund's duration, and you have to be able to view them as a diversifier, and look at overall portfolio performance. When you hold a mix of asset classes designed for proper diversification, you want low correlation, which means that they should not all move in the same direction all the time. Long-term bonds are much more volatile than intermediate bonds.
I'm hesitant to make a recommendation without seeing your entire portfolio, but one idea would be to re-allocate VLGSX to VFICX or VSIGX. Either of those latter funds lost some value over the same period so you buy in more cheaply with your reduced principal from VLGSX. A similar idea would be to reallocate both VSIGX and VLGSX to VBTLX, which lost a little more than VSIGX, so you have a relative gain from VSIGX partially offsetting a relative loss from VLGSX.
I should point out that nobody knows where interest rates are going from here -- they may rise or they may fall. Thus, if you implement one of the changes I articulated, you may avoid further short-term loss but you also may miss a short-term recovery of losses.
I cannot find any purchase date for VSIGX this year from which its total return is down 4%. Are you sure you are including interest payments in your return estimate?
VSIGX is a good core holding for bonds. I'm not enamored with long-term treasuries. There are some on here who recommend and hold them. To do so, you have to have a long holding period, at least as long as the fund's duration, and you have to be able to view them as a diversifier, and look at overall portfolio performance. When you hold a mix of asset classes designed for proper diversification, you want low correlation, which means that they should not all move in the same direction all the time. Long-term bonds are much more volatile than intermediate bonds.
I'm hesitant to make a recommendation without seeing your entire portfolio, but one idea would be to re-allocate VLGSX to VFICX or VSIGX. Either of those latter funds lost some value over the same period so you buy in more cheaply with your reduced principal from VLGSX. A similar idea would be to reallocate both VSIGX and VLGSX to VBTLX, which lost a little more than VSIGX, so you have a relative gain from VSIGX partially offsetting a relative loss from VLGSX.
I should point out that nobody knows where interest rates are going from here -- they may rise or they may fall. Thus, if you implement one of the changes I articulated, you may avoid further short-term loss but you also may miss a short-term recovery of losses.
Last edited by Northern Flicker on Fri May 14, 2021 10:39 pm, edited 1 time in total.
Re: Please be kind ....Newbie with a question
I am in a similar situation as you but I think there is likely a better exit point (flight to "safety" during next stock crash) ahead for bonds in the near term. In the long run (20+ years) though, I don't see how bonds can be a good hold. I am staying the course for now.
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Re: Please be kind ....Newbie with a question
Some of my bond funds did the same thing; they sunk in price not long after I bought them, so I know that sinking feeling. I'm just holding on to them since they may eventually break even or show a profit. So my guess is that it's probably better to not sell them at a loss unless you need to sell them. Wait a while and see what has increased the most in your portfolio, and consider selling whatever that is, if you need to withdraw some cash or rebalance.
Re: Please be kind ....Newbie with a question
OP here. Thank you all for your quick responses.
Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now. My guess is in that time period, (7-12 years) the market will go down somewhat. If not, then I will certainly lose part of my initial investment. But, in my opinion, the odds are that the market will drop at some point in that time period.
If that were to be the case, would those Treasury bond funds be worth holding onto to, to sell at a later date? BTW, my portfolio holds probably 70-75% stocks and stock funds.
Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now. My guess is in that time period, (7-12 years) the market will go down somewhat. If not, then I will certainly lose part of my initial investment. But, in my opinion, the odds are that the market will drop at some point in that time period.
If that were to be the case, would those Treasury bond funds be worth holding onto to, to sell at a later date? BTW, my portfolio holds probably 70-75% stocks and stock funds.
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Re: Please be kind ....Newbie with a question
By using Long-term bonds you are taking a gamble in search of higher yields. Most Bogleheads would be on the side of saying that bonds should be the ballast of your portfolio and should be used to diversify away some risk that you are taking, since you said you have about 70-75% in stocks. The "duration" is the measure (which would be listed on the mutual fund info page) which corresponds most to how much percentage the price of bond fund would rise if the interest rate fell and also how much the bond fund would fall if the interest rate rose. Intermediate-bonds tend to capture a good portion of the longer-term bonds with a smaller duration, and short-term bonds, while yielding less, would have even less change in price depending upon interest rates.
No one can predict interest rates with accuracy, like no one can predict how the stock market or how any particular stock is going to do tomorrow or on any date in the future. Do note that that when interest rates rise and the price is down, new bonds that the mutual fund is buying will be bought at that higher rate. If you're going to hold bonds as long as the stated duration or longer, it might work out all right. But Bogleheads I believe tend to think intermediate is the relative "sweet spot" and also possibly having some short-term bonds is good for a more calm ride for some of your assets. Many use the Vanguard Total Bond Index Fund (for intermediate) or possibly the Vanguard Intermediate-Term Bond Index Fund with a slightly higher duration. These two funds do have corporate and other types of bonds in addition to Treasuries though.
Since these bond funds are in your retirement account they could be sold there without any tax repercussions. If you want to buy stocks at some point and you think stocks have gone down and it's in line with what percentages you want in your stock/bond ratios, you could do that, too. You don't have to sell all at one time. Sometimes stock fall and then they fall even further in some of those crash scenarios. You just have to be sure you have enough bonds (preferably shorter-term ones) or cash equivalent if you need spending money, rather than cashing out stocks or bonds when markets are lower at that point.
No one can predict interest rates with accuracy, like no one can predict how the stock market or how any particular stock is going to do tomorrow or on any date in the future. Do note that that when interest rates rise and the price is down, new bonds that the mutual fund is buying will be bought at that higher rate. If you're going to hold bonds as long as the stated duration or longer, it might work out all right. But Bogleheads I believe tend to think intermediate is the relative "sweet spot" and also possibly having some short-term bonds is good for a more calm ride for some of your assets. Many use the Vanguard Total Bond Index Fund (for intermediate) or possibly the Vanguard Intermediate-Term Bond Index Fund with a slightly higher duration. These two funds do have corporate and other types of bonds in addition to Treasuries though.
Since these bond funds are in your retirement account they could be sold there without any tax repercussions. If you want to buy stocks at some point and you think stocks have gone down and it's in line with what percentages you want in your stock/bond ratios, you could do that, too. You don't have to sell all at one time. Sometimes stock fall and then they fall even further in some of those crash scenarios. You just have to be sure you have enough bonds (preferably shorter-term ones) or cash equivalent if you need spending money, rather than cashing out stocks or bonds when markets are lower at that point.
Last edited by CrossOverGuy on Fri May 14, 2021 10:48 pm, edited 4 times in total.
Re: Please be kind ....Newbie with a question
That's what has happened for the last few "big ones". It's not what happened during the stagflation of the 70s, though.Raven9 wrote: ↑Fri May 14, 2021 8:46 pm Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I've posted about that "worst-case" past scenario for treasury bonds before, if you want to take a look and go fiddle with the calculator link there:
viewtopic.php?p=5819291#p5819291
Having some bonds is a good idea then.I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now.
"The only thing that makes life possible is permanent, intolerable uncertainty; not knowing what comes next." ~Ursula LeGuin
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Re: Please be kind ....Newbie with a question
delete please - see above post
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Re: Please be kind ....Newbie with a question
Seems reasonable.Raven9 wrote: ↑Fri May 14, 2021 8:46 pm OP here. Thank you all for your quick responses.
Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now. My guess is in that time period, (7-12 years) the market will go down somewhat. If not, then I will certainly lose part of my initial investment. But, in my opinion, the odds are that the market will drop at some point in that time period.
I’m down $2k on my three month old purchase of intermediates. They are there if stocks tanks.
I don’t really see stagflation and both crashing at the same time being likely, but have some maturing CDs to cover spending for a while if needed. How about you?
Re: Please be kind ....Newbie with a question
Most advisors, say for example Vanguard, will recommend that you consider a 5-10 year minimum timeframe when purchasing stock. Nobody knows what they base that on, but their motivation for saying it is probably to staunch people from complaining that whatever they just bought went down in value. The idea is that you will see in 5-10 years that they were right and so you should trust them. At the same time they have to tell you by law that past performance is no guarantee of future performance, so ultimately they have zero to base their idea on except hope, faith, belief in capitalism, or greater good hypotheses about how things "should" work.
Now, take bonds. In this case we can absolutely base our predictions on how they will do on something concrete. The only guesswork here are future interest rates, inflation, percentage of default. Other things are known, and in general these particular unknowns affect the values with far less volatility. Bottom line is that you should not invest in bonds unless you are planning to not need the money until at least a timeframe related to the duration of the bond/fund. Anything else is market timing -- just hoping to get lucky dancing on the head of pin, getting in and getting out.
Both types of investments, indeed, investing in general, are typically in terms of an intermediate timeframe. That is a pill you must first swallow. Going forward from there, decide on an asset allocation plan, and stick to it.
Buffet would say that all investing is done with one goal in mind, i.e. to not sell at a loss. I do not buy that this is a sunk cost. Hold onto that perfectly reasonable, sound investment in long and intermediate treasuries and rebalance into it based on your plan. Rising rates are good for bonds relative to the duration of the bond fund. It means they pay more.
You probably still have 40+ years to get through, right?
Now, take bonds. In this case we can absolutely base our predictions on how they will do on something concrete. The only guesswork here are future interest rates, inflation, percentage of default. Other things are known, and in general these particular unknowns affect the values with far less volatility. Bottom line is that you should not invest in bonds unless you are planning to not need the money until at least a timeframe related to the duration of the bond/fund. Anything else is market timing -- just hoping to get lucky dancing on the head of pin, getting in and getting out.
Both types of investments, indeed, investing in general, are typically in terms of an intermediate timeframe. That is a pill you must first swallow. Going forward from there, decide on an asset allocation plan, and stick to it.
Buffet would say that all investing is done with one goal in mind, i.e. to not sell at a loss. I do not buy that this is a sunk cost. Hold onto that perfectly reasonable, sound investment in long and intermediate treasuries and rebalance into it based on your plan. Rising rates are good for bonds relative to the duration of the bond fund. It means they pay more.
You probably still have 40+ years to get through, right?
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Re: Please be kind ....Newbie with a question
Raven9 wrote: ↑Fri May 14, 2021 8:46 pm OP here. Thank you all for your quick responses.
Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now. My guess is in that time period, (7-12 years) the market will go down somewhat. If not, then I will certainly lose part of my initial investment. But, in my opinion, the odds are that the market will drop at some point in that time period.
If that were to be the case, would those Treasury bond funds be worth holding onto to, to sell at a later date? BTW, my portfolio holds probably 70-75% stocks and stock funds.
My thoughts and suggestion...
Op, I suspect your initial purchase of these bonds was based on a holistic consideration of mitigating risks in your then-heavy stock allocation. Now you are regretting that choice on a non-holistic perspective of that particular bond asset. Your stocks presumably have done well over the same period that these bonds tanked some. Holistically, your assets are not losers. You cannot have diversification of risk and have all assets behave equally wonderfully.
My suggestion (if this is in a retirement account) is to keep the diversification you wanted (at least I think that's what you wanted) but remove as much of the psychological temptation to focus on the components as possible. This means keeping some balanced funds that just self-balance and you leave alone. The Vanguard Target Retirement Income Fund (VTINX) has a 70% bond content that includes TIPS content and then, also 30% stocks. So if you put your diversifying bond allocation into a fund like this (or the Vanguard Balanced Index if you do want only US bonds and stocks) and maybe add some TIPS to fine tune your allocation, perhaps you will rest easier and not see-saw in ways that will likely get you buying high and selling low - - whereas a balanced fund will help you keep buying low and selling high. The VTINX fund will probably do better than a straight bond fund if bonds tank, and if stocks tank worse than bonds, it will be buying stocks with bonds which is what the bonds are for.
Re: Please be kind ....Newbie with a question
If you mean the stock market tanking, there is no way to know what the bond market will do. Go up, go down, stay the same - all are possible.Raven9 wrote: ↑Fri May 14, 2021 8:46 pm Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
The loss of value that you have observed is normal bond behavior. When interest rates go up, bond prices go down...but the bond fund starts paying you more...because interest rates are higher! There is no reason to sell what you bought. Well, maybe you should exchange the long term bonds into intermediate term bonds.
At 5 to 7 years out, you need to start thinking about preserving what you have. I think it is time to start increasing your bond allocation, not getting rid of some of it.BTW, my portfolio holds probably 70-75% stocks and stock funds.
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Re: Please be kind ....Newbie with a question
Thank you all for your excellent advice. You've given me a lot to think about. I want you all to know how much I (and so many others) value your expertise. Thanks again!
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Re: Please be kind ....Newbie with a question
**delete, please**
I am not a financial professional or guru. I'm a schmuck who got lucky 10 times. Such is the life of the trader.
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Re: Please be kind ....Newbie with a question
Raven9 wrote: ↑Fri May 14, 2021 6:25 pm Please no lectures on "Why did you buy them in the first place dummy?' I just need a little advice.
A few months ago, I bought about 25K of VSIGX (Intermediate term treasury bond fund) and so far have lost about 1K of value. I also purchased about 20K of VLGSX (Long term treasury bond fund) and have lost over 3K so far.
These are in my Vanguard IRA portfolio. My gut told me not to buy bond funds, but I did anyway.
I believe strongly that interest rates are going to rise within the next 1-2 years.
I hate that I have lost over 4K in just a couple months, but feel like it's likely I will lose even more on these two funds if interest rates do indeed rise.
Would you suggest I sell them now and suck up the loss, and invest in some other Vanguard funds? Or just hold onto them, and sell if we happen to get a bear market and their prices go up?
I am a NEWBIE and bonds are something I understand the least. Just not sure of the right move here.
The rest of my portfolio is mixed and I would say balanced to my comfort level.
Thank you in advance!
No need to lecture, invest for the long-term not for the short-term. Long-term higher interest rates are good for the bond investor. Don't worry about short-term changes in share price, and "a few months" is very short-term.Raven9 wrote: ↑Fri May 14, 2021 8:46 pm OP here. Thank you all for your quick responses.
Do you agree with the (broad) following scenario? IF the market were to tank, the Treasury bonds price per share would rise, and then I could sell at a possible gain and buy stocks when they were lower? (If so, then I suppose it would be worth holding onto them.)
I have 5-7 years until retirement, and don't need the money in these funds until then, or possibly 7-12 years from now. My guess is in that time period, (7-12 years) the market will go down somewhat. If not, then I will certainly lose part of my initial investment. But, in my opinion, the odds are that the market will drop at some point in that time period.
If that were to be the case, would those Treasury bond funds be worth holding onto to, to sell at a later date? BTW, my portfolio holds probably 70-75% stocks and stock funds.
My personal preference is for intermediate-term bond funds. Historically treasury bond funds are the best diversifier for an equity portfolio. Morningstar (8/20/2019) "The Best Diversifiers for Your Equity Portfolio", link.
If the overall equity/fixed income allocation of you portfolio is at your comfort level, just stay with what you have. But 5-7 years from retirement you need to protect your assets, an even higher bond allocation would be reasonable in my opinion.
Last edited by ruralavalon on Sat May 15, 2021 12:07 pm, edited 3 times in total.
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Re: Please be kind ....Newbie with a question
BTW, my portfolio holds probably 70-75% stocks and stock funds.
You're 5-7 years from retirement.At 5 to 7 years out, you need to start thinking about preserving what you have. I think it is time to start increasing your bond allocation, not getting rid of some of it.
Your bond portfolio just lost a few thousand dollars of value.
You're 70-75% stocks and stock funds.
Instead of lamenting the few thousand "down" in bond funds, you could be celebrating the probable rise in your stocks and stock funds!
I agree with those who mentioned at your stage you might be looking to increase your bond allocation. (At retirement, I held 40% equities/60% fixed income. I feel very comfortable with that conservative mix.)
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Re: Please be kind ....Newbie with a question
My bigger concern is that you seem to be holding individual stocks. In addition to market risk, these take risks unique to the company in question. Because that risk can be diversified away, you are not compensated thtough additional expected return for taking it.
Last edited by Northern Flicker on Sun May 16, 2021 1:53 am, edited 1 time in total.
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Re: Please be kind ....Newbie with a question
Does the $45K in those two bond funds represent your total 25% allocation to fixed income or are you holding other fixed income in addition to those two purchases above? Second, what is your time horizon? You are retiring in 5-7 years but you will be withdrawing monies from your various funds over a much longer time period, longer than the duration of the long term treasury fund I suspect. I would not be selling now, the decline in NAV if held for the duration of the fund will be made up by the higher coupon you will earn. Stocks are for growth, bonds are for safety. While your bond funds have declined 11.1%, stocks can decline much much more. Keep the bonds.Raven9 wrote: ↑Fri May 14, 2021 6:25 pm Please no lectures on "Why did you buy them in the first place dummy?' I just need a little advice.
A few months ago, I bought about 25K of VSIGX (Intermediate term treasury bond fund) and so far have lost about 1K of value. I also purchased about 20K of VLGSX (Long term treasury bond fund) and have lost over 3K so far.
These are in my Vanguard IRA portfolio. My gut told me not to buy bond funds, but I did anyway.
I believe strongly that interest rates are going to rise within the next 1-2 years.
I hate that I have lost over 4K in just a couple months, but feel like it's likely I will lose even more on these two funds if interest rates do indeed rise.
Would you suggest I sell them now and suck up the loss, and invest in some other Vanguard funds? Or just hold onto them, and sell if we happen to get a bear market and their prices go up?
I am a NEWBIE and bonds are something I understand the least. Just not sure of the right move here.
The rest of my portfolio is mixed and I would say balanced to my comfort level.
Thank you in advance!
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions
Re: Please be kind ....Newbie with a question
What does your Investment Policy Statement say re Asset Allocation and specific bond funds? Everyone understands the angst of diminished fund value—the key here is investor behavior in the face of disappointing results. This is where reflection and review of your IPS can be helpful. If you don’t yet have an IPS..no shame—I’m guessing others can provide a link to help you with this.
Cheers,
DangerDad
Cheers,
DangerDad