Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
At over 40% bond fund allocation! I've been looking for some encouragement on this front lately FWIW.
For those concerned about the outlook for bond returns in the years ahead, one person's (Rick Ferri) view for your consideration. If you plan to read the articles, don't look at the quote below the links, it gives away the conclusion.
Fears of Soaring Rates are Overblown (Part 1 of 2)
Fears of Soaring Rates are Overblown (Part 2 of 2)
For those concerned about the outlook for bond returns in the years ahead, one person's (Rick Ferri) view for your consideration. If you plan to read the articles, don't look at the quote below the links, it gives away the conclusion.
Fears of Soaring Rates are Overblown (Part 1 of 2)
Fears of Soaring Rates are Overblown (Part 2 of 2)
Individual bonds and bond mutual funds are going to deliver a punch sometime in the next few years, but it won’t be a deadly blow. I don’t have a good answer for what is coming, except to say that broad diversification helps, and don’t fight the Fed by trying to predict the timing of their balance sheet unwinding. We’re prepared to muddle through a difficult bond market in the same way we’ve been muddling through a difficult stock market since 2007 – diversify, rebalance, and stay the course.
Fed Chairman Ben Bernanke and the FOMC will likely begin unwinding their balance sheet in a slow and controlled manner starting around 2014. The process will reduce the total return of every bond portfolio over the next decade whether an investor holds individual bonds or mutual funds. Think of it as giving back gains that we should have never earned. On the positive side, I don’t believe rates will soar during the unwinding. This should make the reversal somewhat palatable, whenever it comes.
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