Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 10-22-2020, 12:56 PM   #81
Thinks s/he gets paid by the post
Out-to-Lunch's Avatar
 
Join Date: Jan 2020
Location: Milwaukee
Posts: 1,161
Quote:
Originally Posted by dixter View Post
for example... if you buy a bond with 10% coupon and its valued at $1500 then it would be best to monitor the bond over time and attempt to recover the over par premium by simply reselling the bond before the maturity date... you may not get back the $500 cost in full but you could get close or if luck is on your side, even get back more than the $500...

Forgive me if I am putting words in your mouth: Perhaps I could interpret these sentiments as asserting that the coupon rate (and concomitant inflated value over par) has an effect on the bond's convexity.... That is, that this bond would respond differently to changes in interest rates compared to other bonds of the same duration but different coupon (i.e., value vs. par).

Hmmm, I would have to think very hard about this, but I could perhaps believe it.
Out-to-Lunch 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 10-22-2020, 01:32 PM   #82
Recycles dryer sheets
 
Join Date: Sep 2014
Posts: 178
Quote:
Originally Posted by Out-to-Lunch View Post
Forgive me if I am putting words in your mouth: Perhaps I could interpret these sentiments as asserting that the coupon rate (and concomitant inflated value over par) has an effect on the bond's convexity.... That is, that this bond would respond differently to changes in interest rates compared to other bonds of the same duration but different coupon (i.e., value vs. par).

Hmmm, I would have to think very hard about this, but I could perhaps believe it.
There are many different parameters that can affect a bonds value (either below par or above par).. coupon rates and durations are just two parameters... a bonds rating would be another parameter.. and many many more

I have no connection with Fidelity but here is a presentation that you might like...

https://www.fidelity.com/learning-ce...ting-recording
dixter is offline   Reply With Quote
Old 10-22-2020, 02:26 PM   #83
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 28,783
Quote:
Originally Posted by NW-Bound View Post
... A big portion of my fixed income AA is in a Black Rock T-Fund. Its yield varies, and used to pay 2% which would offset inflation, but is now only 0.01%/yr!
I just looked at my wife's 401K Stable Value fund. YTD, it has paid 4.03% cumulative!

Wow, how do they do that? Loan sharking?
__________________
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
NW-Bound is online now   Reply With Quote
Old 10-22-2020, 04:47 PM   #84
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jan 2018
Location: Tampa
Posts: 7,982
Quote:
Originally Posted by NW-Bound View Post
I just looked at my wife's 401K Stable Value fund. YTD, it has paid 4.03% cumulative!

Wow, how do they do that? Loan sharking?
Could be heavy investing in riskier bonds such as mortgage backed bonds. This is true for my SV fund which has a current gross of 4.01%.
__________________
TGIM
Dtail is online now   Reply With Quote
Old 10-22-2020, 05:27 PM   #85
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
NW-Bound's Avatar
 
Join Date: Jul 2008
Posts: 28,783
Quote:
Originally Posted by Dtail View Post
Could be heavy investing in riskier bonds such as mortgage backed bonds. This is true for my SV fund which has a current gross of 4.01%.

Does not look too "stable" to me.

I don't know what my wife's fund does, but we have only 4.3% of investable assets in that fund.
__________________
"Those Who Can Make You Believe Absurdities Can Make You Commit Atrocities" - Voltaire (1694-1778)
NW-Bound is online now   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


Similar Threads
Thread Thread Starter Forum Replies Last Post
Jonathan Clements on Delaying Soc. Security and Annuties............. Cut-Throat FIRE and Money 13 06-18-2007 01:08 PM
An article by JONATHAN CLEMENTS for all you real smart investors out there. Cut-Throat FIRE and Money 20 04-10-2007 04:24 AM
Jonathan Clements Article today - Contrary Advice Cut-Throat FIRE and Money 3 10-22-2006 08:45 AM
Jonathan Clements Touts Firecalc in WSJ grumpy FIRE and Money 0 05-21-2006 01:01 PM
Jonathan Clements Article today...... Cut-Throat Other topics 17 07-14-2004 05:36 PM

» Quick Links

 
All times are GMT -6. The time now is 11:59 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2021, vBulletin Solutions, Inc.