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Old 04-10-2019, 09:28 AM   #21
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Originally Posted by Sunset View Post
I have managed to buy a few CD's at the brokerage, but it's certainly not as easy as buying stock/etf's.


I've bought new issue brokered CDs with no trouble.
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Old 04-10-2019, 10:08 AM   #22
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Yeah, pretty much for my intermediate bond funds, anything longer than 5 years which my retirement portfolio certainly is, no problem.
I'm more of a fan of treasury bonds instead of total bonds, but the analysis is the same. During the big inflation & interest rate run up from the early 1970's to about 1980, shorter duration bond funds would have been a good choice since they react more quickly to interest rate changes and inflation whereas during the great bond-bull market from 1980 to just a couple of years ago when bond rates were dropping, longer duration bond funds would have been the better answer. I did an analysis using the Simba spreadsheet from Bogleheads to see, within the context of my overall portfolio, what the best average duration would have been across both scenarios and, yep, a duration that is just about the same as the duration of most intermediate bond funds turned out to be about the best answer if one is going to choose a static bond duration. Seemed to also be a decent answer for more or less steady interest rates as well.
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Old 04-10-2019, 10:13 AM   #23
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Originally Posted by big-papa View Post
I'm more of a fan of treasury bonds instead of total bonds, but the analysis is the same. During the big inflation & interest rate run up from the early 1970's to about 1980, shorter duration bond funds would have been a good choice since they react more quickly to interest rate changes and inflation whereas during the great bond-bull market from 1980 to just a couple of years ago when bond rates were dropping, longer duration bond funds would have been the better answer. I did an analysis using the Simba spreadsheet from Bogleheads to see, within the context of my overall portfolio, what the best average duration would have been across both scenarios and, yep, a duration that is just about the same as the duration of most intermediate bond funds turned out to be about the best answer if one is going to choose a static bond duration. Seemed to also be a decent answer for more or less steady interest rates as well.
The bond index funds tracking the BBgBarc US Agg Bond TR USD hold about 70% US government debt including treasuries, and about 30% investment grade corporate debt. They generally behave quite well during stock downturns. So good enough for me.
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Old 04-10-2019, 10:36 AM   #24
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... a TIPs pseudo-ladder set up to generate an inflation adjusted income stream to supplement SS for about 15 years once I start taking SS at age 70. ...
Why not a real ladder of real TIPS? No fees, ultimate flexibility.
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Old 04-10-2019, 10:48 AM   #25
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Why not a real ladder of real TIPS? No fees, ultimate flexibility.
If somebody wants to set that up, that's great. Works just fine and to each his/her own. For me, fees are small enough to not matter and the flexibility really isn't any different. Main difference is I have about 5 minutes work to rebalance once a quarter vs. the initial setup of a TIPs ladder. Good enough.

And to be fully transparent, what I have isn't just TIPs - I also have Ibonds in the mix as well and a spreadsheet that tracks everything automatically. And, more importantly, a wife who understands it.
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Old 04-10-2019, 10:59 AM   #26
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The bond index funds tracking the BBgBarc US Agg Bond TR USD hold about 70% US government debt including treasuries, and about 30% investment grade corporate debt. They generally behave quite well during stock downturns. So good enough for me.
Yep - it's the most common choice and a perfectly fine one indeed! As I mentioned above, bonds can behave well during downturns, especially the last two big ones. That hasn't always been the case, so I tend to think of them more as just another uncorrelated asset. Even with that said, treasuries tended to do even better during those 2 downturns, but I'm not counting on it. For me, it's just a way of completely separating out my bonds from the corporate world, since I already have plenty of coverage via my stocks.
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Old 04-10-2019, 11:00 AM   #27
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Re: TIPS and Treasuries:
Anybody buying these through your broker instead of treasurydirect.gov??
Maybe I'm looking in the wrong place, but I see typical minimum purchase quantities of $200K+ at the broker with occasional smaller quantities on the secondary market.
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Old 04-10-2019, 11:11 AM   #28
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Re: TIPS and Treasuries:
Anybody buying these through your broker instead of treasurydirect.gov??
Maybe I'm looking in the wrong place, but I see typical minimum purchase quantities of $200K+ at the broker with occasional smaller quantities on the secondary market.
I am not a big bond guy but I have bought t-bills on the auction, new issue brokered CDs and used TIPS through the Schwab bond desk. Great guys. Easy transactions. 800-824-4027 I suggest that you call them with your question. They probably have enough industry knowledge to tell you about at least some the competiion's rules and practices.

I have no interest in screwing around with a treasurydirect.com account and consequent funds transfers. I have never even looked into it.
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Old 04-10-2019, 11:19 AM   #29
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Re: TIPS and Treasuries:
Anybody buying these through your broker instead of treasurydirect.gov??
Maybe I'm looking in the wrong place, but I see typical minimum purchase quantities of $200K+ at the broker with occasional smaller quantities on the secondary market.
I buy them one at a time frequently through Fidelity and Merrill.

If you're looking at the secondary market screen on Fidelity, it will only show the best price/yield - which generally requires a larger purchase. However, if you click on the Depth of Book icon towards the right, it will show all of the other offers.

At auction, similarly, you're free to purchase as few as one.
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Old 04-10-2019, 11:46 AM   #30
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Re: TIPS and Treasuries:
Anybody buying these through your broker instead of treasurydirect.gov??
Maybe I'm looking in the wrong place, but I see typical minimum purchase quantities of $200K+ at the broker with occasional smaller quantities on the secondary market.
Fidelity has an easy interface to buy new or secondary issues. The smallest amount I found just doing a quick search was 25 bonds. So not $200k, but still a reasonably high minimum.
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Old 04-10-2019, 12:18 PM   #31
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Fidelity has an easy interface to buy new or secondary issues. The smallest amount I found just doing a quick search was 25 bonds. So not $200k, but still a reasonably high minimum.
I just used NJHOWIE's tip of buying a 100K minimum treasury from the Fidelity "depth of book" icon and bought 22K maturing in July to play with. I could have bought only one.
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Old 04-10-2019, 12:37 PM   #32
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I just used NJHOWIE's tip of buying a 100K minimum treasury from the Fidelity "depth of book" icon and bought 22K maturing in July to play with. I could have bought only one.
Nice!
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Old 04-10-2019, 12:40 PM   #33
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I just used NJHOWIE's tip of buying a 100K minimum treasury from the Fidelity "depth of book" icon and bought 22K maturing in July to play with. I could have bought only one.
I just checked that out myself. What a great tip.
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