I sold my Total Bond (VBTLX) a few months ago at a pretty healthy loss. However, I held on to my Short Term Investment Grade (VFSUX) and my Intermediate Term Tax Exempt (VWIUX). The total of these holdings is high in the 6 figures. Losses are a bit more than 40K at this point. I have had both these funds for many years.
I have always subscribed to the Buy and Hold philosophy, that Bonds are the Ballast, the safety net....that Bonds zig when stocks zag and blah, blah, blah. I have kept telling myself to stay the course and stick with my IPS. However, with large pending rate increases, it seems that Bonds have a lot more falling to do. Dividend payments should slowly increase, of course, but it is going to take a lot of years to make up for the losses.
Now I am wondering if I should just suck it up, lock in my losses and plop the money in short term cd or treasury ladders until the rate increases stabilize. It goes against my IPS but this environment is challenging my prior thoughts.
Hindsight is 20/20.
So....anyone else still holding bond funds and staying the course?
Still learning,
KooK
I have always subscribed to the Buy and Hold philosophy, that Bonds are the Ballast, the safety net....that Bonds zig when stocks zag and blah, blah, blah. I have kept telling myself to stay the course and stick with my IPS. However, with large pending rate increases, it seems that Bonds have a lot more falling to do. Dividend payments should slowly increase, of course, but it is going to take a lot of years to make up for the losses.
Now I am wondering if I should just suck it up, lock in my losses and plop the money in short term cd or treasury ladders until the rate increases stabilize. It goes against my IPS but this environment is challenging my prior thoughts.
Hindsight is 20/20.
So....anyone else still holding bond funds and staying the course?
Still learning,
KooK