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be careful with bonds now . they have been getting beaten up the last 3 months pretty bad and it may continue . you may want to wait a while to add bonds or just stay in something like pimco mint for the bond portion . a years worth of interested evaporated off the value of agg in just the last 90 days .
this is something i have been warning about for a while .
Long term investors know bonds play a key role in the diversified portfolio. But, yes bonds of just about every flavor have been ugly. Offsetting them has been a strong equities market. Timing is for very few people.
Quote:
Originally Posted by mathjak107
be careful with bonds now . they have been getting beaten up the last 3 months pretty bad and it may continue . you may want to wait a while to add bonds or just stay in something like pimco mint for the bond portion . a years worth of interested evaporated off the value of agg in just the last 90 days .
this is something i have been warning about for a while .
investors counted on bonds the last 35 years and bonds played a key roll . but for 35 years interest rates only went down with only a few speed bumps in the road .
they were always adding a positive to the portfolio . that may no longer be the case . deflation has been becoming more and more off the radar and inflation in the 2-3% range is now looking more and more possible over the next 5 years . wage inflation is now at the highest it has been since 2008.
you could literaly buy and die with bonds up until recently . now they seemed to have turned the corner and are getting creamed the last 3 months . even the days stocks are down they are still falling . TLT the long treasury bond has seen the equal of a 800-900 point drop in the dow just this week .
Last edited by mathjak107; 11-11-2016 at 09:59 AM..
Long term investors know bonds play a key role in the diversified portfolio. But, yes bonds of just about every flavor have been ugly. Offsetting them has been a strong equities market. Timing is for very few people.
So if I have to transfer (i.e. sell) all my holdings and put everything in one or two funds?
Should I do that little by little? If do it all together, I may be hurting selling low and buying the new funds high?
Some people like to DCA - dollar cost average - but personally I don't think DCA is worth it. It gets debated a lot on investing forums without any clear consensus which tells me it is not worth using. The wonderful thing about a 401k is that you can trade within it without worrying about tax consequences. I would just sell everything and then buy whatever all at once.
I went through something similar many years ago when I abandon stocks and put all our money into funds (mostly VTI and AGG). But a lot of that was in a taxable account which generated huge cap gains. But I felt that it was worth it so did it anyway.
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