We’re thinking of selling some our stock index funds to buy safe long-term bonds.
We’ll be 66 next year.
+1. Evidently the OP is confident he/she can time the market.I’m not a market timer so no, I wouldn’t sell stocks to buy CDs or bonds. Interest rates are great today but that won’t last long term. I just stick with our 60/40 asset allocation.
I’m not a market timer so no, I wouldn’t sell stocks to buy CDs or bonds. Interest rates are great today but that won’t last long term. I just stick with our 60/40 asset allocation.
Or they just want to change their AA and want to time it opportunistically.+1. Evidently the OP is confident he/she can time the market.
Or they just want to change their AA and want to time it opportunistically.
We stay ~50% equities. The fixed income portion is short to intermediate duration.
Not touching long bonds.
We don’t pay attention to income generated either. Total return baby!
Almost all of our equities will end up in our estate. That's long term money, so no reason to sell. Market timing is impossible, so again there's no reason to sell. Watching the market's short term behavior is nothing more than entertainment; it tells us nothing substantive. So no reason to sell there either.We’re thinking of selling some our stock index funds to buy safe long-term bonds.
We’ll be 66 next year.
If we were to change our AA, this is the time to do it. Still on the fence. It’s a different story if we were 40 yrs. old, there’s plenty of time to recover. We were 50 in 2008 and remained strong in the market. Thoughts of preservation dancing in my head.
For those thinking we are near the top in terms of LT yields, you can pick up the US Treasury 30 year bond 1.25% coupon maturing 5/15/2050, issued 5/15/2020 for less than 50 cents on the dollar. (It reached a low today of 48 and 23/32nds and had a high over 101 in Aug 2020.) YTM is over 4.6%.
So much for a "risk free" investment (that is trading for less than half its original value, and for all those "well it will be redeemed at par" folks well I just lol.)
If one really thinks rates have peaked, long duration is your friend. Even better than the bond above would be zero coupon (STRIPS), assuming held in a tax-free account (e.g. IRA) we re phantom income isn't a concern.
Are long bonds >10 years for you?
> 5 or so years really. I keep my fixed income overall duration to 5 years.