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challenge for CD like funds
Old 07-21-2012, 09:56 AM   #1
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challenge for CD like funds

The challenge is to find a fund/etf, etc. that has less volitility and better return that PTTRX. And by volitiity, i mean no dips when the market tanks. This website graph includes div in total return for stocks/mutuals, etc.

I don't think beta is the right term to use, I could be wrong but I think a perfectly flat line with a slope up has worse beta than a flat level line. So using stock screener looking for low beta stocks/funds hasn't done well.

look at results over 5, 10 and 3 year

PTTRX Chart PIMCO Total Return Instl Fund Chart
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Old 07-21-2012, 10:45 AM   #2
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There is no such thing as a free lunch. If you want greater than current CD returns, you will take more risk, end of story. Don't be fooled by the trailing performance of things like PTTRX and be honest with yourself about the amount of risk you are taking.

A few more thoughts on how to squeeze out a bit more yield are here Life, Investments & Everything: Where to Invest "Safe" Money? but you take more risk every time you reach.
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Old 07-21-2012, 11:59 AM   #3
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The upward slope in the graph that you linked is principally due to 1) compounding and 2) interest rate gains as a result of the decline in interest rates from 2002-2012.

PTTRX is nothing like a CD. It has significant interest rate risk where a CD has no interest rate risk. It has moderate credit risk where a FDIC insured CD would have minimal credit risk.
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Old 07-21-2012, 05:55 PM   #4
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Quote:
Originally Posted by pb4uski View Post
The upward slope in the graph that you linked is principally due to 1) compounding and 2) interest rate gains as a result of the decline in interest rates from 2002-2012.

PTTRX is nothing like a CD. It has significant interest rate risk where a CD has no interest rate risk. It has moderate credit risk where a FDIC insured CD would have minimal credit risk.
But the chart does look good vs other bond tools with 3.85% yield.
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