Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-18-2012, 10:43 AM   #21
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,672
Quote:
Originally Posted by FinanceDude View Post
2.6% is not a big deal. You can get higher without going crazy. You just have to do a little research.
That 2.6% is just what the fund is yielding at this moment. Of course, it does not mean the total return will be 2.6%. I hope we agree that risk/return is pretty much baked in when it comes to the bond market. As a whole the bond market is very efficient. If you are getting 5% SEC yield you are taking on a lot more risk.

BTW, the Pimco Total Return fund (PTTRX) has a 3.4% distribution yield as of last month. It has beaten VFICX over the longer term and recently but not over the 3 years time frame.
__________________

__________________
Lsbcal is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-18-2012, 11:03 AM   #22
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by Brat View Post
I am looking around for yield too, something for my short term (6 years to empty) bucket. I am considering a blend of a short term treasury bond index and FSBIX (Thompson Plumb Bond Fund). Does anyone have comments on the latter?
Looks like a kind of expensive option for a bond fund at 80BP annual fees.
__________________

__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 07-18-2012, 11:03 AM   #23
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,834
Quote:
Originally Posted by Lsbcal View Post
The duration on that is about 5.4 years. So you'd probably want to hold it that long I guess. I notice the 30 day SEC yield is about 2.6% for the admiral equivalent.

But check out the big dip in 2008 to know what risk you are taking on. So I ask myself why take that risk when I could just bump up my equities a bit? Is 2.6% nominal yield something to get excited about?

BTW, my comments are only for those choosing a buy and hold approach. If one is going to try to time the bond component then one needs to do a lot of homework first.
My point is that it's part of my 50% bond allocation, I bought it a couple of years ago as I wanted to have more corporate bonds that total bond index alone would have given me. That's as exotic as I get.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is offline   Reply With Quote
Old 07-18-2012, 11:04 AM   #24
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,612
Quote:
Originally Posted by brewer12345 View Post
Looks like a kind of expensive option for a bond fund at 80BP annual fees.
That was my thought, too. It's hard to argue with the long term performance of this fund but I'm still not comfortable giving 80 basis points to any fund, and especially not a bond fund.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is online now   Reply With Quote
Old 07-18-2012, 11:19 AM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,672
Quote:
Originally Posted by nun View Post
My point is that it's part of my 50% bond allocation, I bought it a couple of years ago as I wanted to have more corporate bonds that total bond index alone would have given me. That's as exotic as I get.
Sounds like you know what you are doing. I thought you were talking about just now getting into this fund so was stating the case for what one should be thinking about to reallocate right now.

I was actually responding to the "searching" part of the thread title. Sorry for the misunderstanding but maybe it helped someone reading this.
__________________
Lsbcal is offline   Reply With Quote
Old 07-18-2012, 11:25 AM   #26
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,834
Quote:
Originally Posted by Lsbcal View Post
Sounds like you know what you are doing. I thought you were talking about just now getting into this fund so was stating the case for what one should be thinking about to reallocate right now.

I was actually responding to the "searching" part of the thread title. Sorry for the misunderstanding but maybe it helped someone reading this.
Yes, in the title of the thread I was referring to the general search for yield as highlighted by articles that have been pushing various high yield options recently. I would never own such high yielding investments because of the risk, leverage and stuff under the hood that I don't understand.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is offline   Reply With Quote
Old 07-18-2012, 12:03 PM   #27
Thinks s/he gets paid by the post
 
Join Date: Mar 2011
Posts: 3,695
I've been very happy with my bond funds. One is a mix of bonds and a few equities the other is a high yield (yes, I know...junk bonds).

Each has paid consistent 4% and 7.5% dividends respectively for the past 20 years. With the shake out on so many companies, the default in high yield funds has dropped somewhat as well.

YMMV
__________________
Living well is the best revenge!
Retired @ 52 in 2005
marko is offline   Reply With Quote
Old 07-18-2012, 01:09 PM   #28
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,834
Quote:
Originally Posted by marko View Post
I've been very happy with my bond funds. One is a mix of bonds and a few equities the other is a high yield (yes, I know...junk bonds).

Each has paid consistent 4% and 7.5% dividends respectively for the past 20 years. With the shake out on so many companies, the default in high yield funds has dropped somewhat as well.

YMMV
My ER strategy is geared towards reducing my need for income rather than seeking out big dividends. So I am happy with my total bond index and intermediate corporate mix for fixed income. However, there are lots of people who see 10% plus dividends and dive right in. I'm interested in the pitfalls of that.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is offline   Reply With Quote
Old 07-18-2012, 01:28 PM   #29
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,031
Quote:
Originally Posted by nun View Post
However, there are lots of people who see 10% plus dividends and dive right in. I'm interested in the pitfalls of that.
Two words: value trap.

Personally, I am happy with my assets yielding ~3% (target WR), so I haven't had to reach too far for yield yet.
__________________
FIREd is offline   Reply With Quote
Old 07-18-2012, 01:42 PM   #30
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,672
The Vanguard Value Index Fund yields 2.93% currently. And Total Stock Market is at 2.1%.

Yield + growth, in a low interest rate environment.
__________________
Lsbcal is offline   Reply With Quote
Old 07-18-2012, 02:17 PM   #31
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,406
Quote:
Originally Posted by Lsbcal View Post
The Vanguard Value Index Fund yields 2.93% currently. And Total Stock Market is at 2.1%.

Yield + growth, in a low interest rate environment.
Yep. And for those with the fortitude, the international ETF EFA is yielding 3.4% and most European ETFs are also above 3%.

This is the second thread on yield - this may be a contrarian sign for high yield products. Still, Ben Bernanke has committed to keeping rates low for a while longer, so there's no need to rush to the exits.

A well run global corporation should be able to create lots of opportunities when it can borrow as much as it wants at such low rates.
__________________
MichaelB is online now   Reply With Quote
Old 07-18-2012, 02:20 PM   #32
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,484
Quote:
Originally Posted by Lsbcal View Post
That 2.6% is just what the fund is yielding at this moment. Of course, it does not mean the total return will be 2.6%. I hope we agree that risk/return is pretty much baked in when it comes to the bond market. As a whole the bond market is very efficient. If you are getting 5% SEC yield you are taking on a lot more risk.
Yes and no. There are some funds doing 3.5-4.5% distribution rate that are not loaded up 70% on high yield..........
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 07-18-2012, 03:20 PM   #33
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,396
Quote:
Originally Posted by nun View Post
My point is that it's part of my 50% bond allocation, I bought it a couple of years ago as I wanted to have more corporate bonds that total bond index alone would have given me. That's as exotic as I get.
+1 I did the same as Total Bond has too much gov't and insufficient corporates for my taste so Intermediate Investment Grade is ~75% of my bond allocation. I do have a 16% slug of High Yield Corporate and that is as exotic as I get on the bond side.
__________________
pb4uski is offline   Reply With Quote
Old 07-18-2012, 11:28 PM   #34
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
 
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 5,913
Quote:
Originally Posted by brewer12345 View Post
(THOPX) Looks like a kind of expensive option for a bond fund at 80BP annual fees.
I agree but I can't find a good short or intermediate corporate bond fund with comparable performance that is cheaper. I am open to suggestions.
__________________
Duck bjorn.
Brat is offline   Reply With Quote
Old 07-19-2012, 12:22 PM   #35
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
 
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 5,913
Has anyone commented on Fidelity Floating Rate High Income Fund (FFRHX)?
__________________
Duck bjorn.
Brat is offline   Reply With Quote
Old 07-19-2012, 02:03 PM   #36
Thinks s/he gets paid by the post
nun's Avatar
 
Join Date: Feb 2006
Posts: 4,834
Quote:
Originally Posted by Brat View Post
Has anyone commented on Fidelity Floating Rate High Income Fund (FFRHX)?
I'd say it's expensive and it's return comes out of riskier debt that I'd like to buy.
__________________
“So we beat on, boats against the current, borne back ceaselessly into the past.”

Current AA: 65% Equity Funds / 20% Bonds / 7% Stable Value /3% Cash / 5% TIAA Traditional
Retired Mar 2014 at age 52, target WR: 0.0%,
Income from pension and rent
nun is offline   Reply With Quote
Old 07-19-2012, 02:13 PM   #37
Thinks s/he gets paid by the post
 
Join Date: Jul 2005
Posts: 3,862
Quote:
Originally Posted by Brat View Post
Has anyone commented on Fidelity Floating Rate High Income Fund (FFRHX)?
I looked at that near the beginning of the year. It dropped a lot in 2009/9, so it didn't look too appealing to me. However, I was looking for something closer to cash than not.
__________________
Animorph is offline   Reply With Quote
Please try to specify your funds
Old 07-21-2012, 01:14 PM   #38
Recycles dryer sheets
 
Join Date: Nov 2008
Posts: 111
Please try to specify your funds

Quote:
Originally Posted by marko View Post
I've been very happy with my bond funds. One is a mix of bonds and a few equities the other is a high yield (yes, I know...junk bonds).

Each has paid consistent 4% and 7.5% dividends respectively for the past 20 years. With the shake out on so many companies, the default in high yield funds has dropped somewhat as well.

YMMV
There is no point in talking & preaching generalities. One must give specific example---- Some of the CEF's & Mutual funds with good yields that I have, are----
DSU
MHI
PMM
DHF
GABUX
VWIAX
PASDX etc, etc
These are the examples of dividend paying funds. I don't know if these are good for long term or not. But I don't like to talk without specifics.
__________________
rsingh6675 is offline   Reply With Quote
Old 07-21-2012, 01:51 PM   #39
Recycles dryer sheets
 
Join Date: Dec 2006
Posts: 406
Quote:
Originally Posted by rsingh6675 View Post
There is no point in talking & preaching generalities. One must give specific example---- Some of the CEF's & Mutual funds with good yields that I have, are----
DSU
MHI
PMM
DHF
GABUX
VWIAX
PASDX etc, etc
These are the examples of dividend paying funds. I don't know if these are good for long term or not. But I don't like to talk without specifics.
Thanks, I like your direct answer. Generalities and preaching do not accomplish anything.
__________________
wolf is offline   Reply With Quote
Old 07-21-2012, 03:33 PM   #40
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by Brat View Post
Has anyone commented on Fidelity Floating Rate High Income Fund (FFRHX)?
It is a junky loan fund. Little interest rate risk, plenty of credit risk, but safer than junk bonds. I like the asset class but it is getting pricy.
__________________

__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 05:29 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.