Fidelity managed bond account- help

[Katoslake]

Attached are the positions in my Fidelity bond account.

This account was constructed by the Fidelity managed bond team. I have since terminated their management of this account.
The CD's were purchased by me.

Any thoughts or advice will be appreciated !

[yakers]

I'm definitely not a bond person, tend to buy other fixed income assets but at a glance these look good to me. I'll wait for the more knowdlegable folks to chime in.

[COcheesehead]

Can you view this portfolio in Fidelity’s fixed income analysis tool? It will summarize a lot of helpful data including duration, yield, cashflow, etc. There’s almost too much to wrap your head around in that spreadsheet.

[orbops]

Are you comfortable with using Excel pivot tables? I checked out your spreadsheet using a pivot table, and it can provide a lot of information that you are looking for.

Looks like a nice spread across various bond types:
Agency 17.99%
CD 24.08% It looks like you're doing a CD ladder out to 18 months with one going out to almost 4 yrs; avg yield is 4.1762%
Corporate 24.29%; avg yield is 5.34%
Municipal 2.53%
Treasury 31.11%; avg yield is 4.11%
Grand Total 100.00%

One general comment is that since you've got so many individual bonds with different maturity dates, if you are automatically rolling them over, be cognizant of those maturity dates in case you need the money in the short term.

[Katoslake]

Quote:

Originally Posted by COcheesehead Can you view this portfolio in Fidelity’s fixed income analysis tool? It will summarize a lot of helpful data including duration, yield, cashflow, etc. There’s almost too much to wrap your head around in that spreadsheet.

I’ll post the summary shortly. Thanks

[Katoslake]

Quote:

Originally Posted by orbops Are you comfortable with using Excel pivot tables? I checked out your spreadsheet using a pivot table, and it can provide a lot of information that you are looking for. Looks like a nice spread across various bond types: Agency 17.99% CD 24.08% Corporate 24.29% Municipal 2.53% Treasury 31.11% Grand Total 100.00%

Thanks for the summary ! I was wondering if I should sell (if possible) some of these bonds, even at a loss given current interest rates ?

I can stay put if that’s the best option

[COcheesehead]

Quote:

Originally Posted by Katoslake Thanks for the summary ! I was wondering if I should sell (if possible) some of these bonds, even at a loss given current interest rates ? I can stay put if that’s the best option

The Fidelity Fixed income Analysis tool will give you better info.

[Freedom56]

Quote:

Originally Posted by Katoslake Attached are the positions in my Fidelity bond account. This account was constructed by the Fidelity managed bond team. I have since terminated their management of this account. The CD's were purchased by me. Any thoughts or advice will be appreciated !

I'm assuming you bought all the CDs at YTMs well over 4% and those with lower coupons on the secondary market below par. If that's the case, you are off to a good start "making your own sausage". You have about $326K maturing this year and in particular the 0.5% treasury note so I would not sell anything at this point. Just invest the proceeds in higher coupon corporate notes or CDs. You should be able to generate about $18k of income from the $326K invested at 5.6%.

[azxracer]

Is that your Fidelity account number in column L?

[Katoslake]

Quote:

Originally Posted by azxracer Is that your Fidelity account number in column L?

Here's the fixed income summary

[COcheesehead]

Quote:

Originally Posted by Katoslake Here's the fixed income summary

You’ll get $72,000 ish in capital gain in addition to the income so for that duration, I think you look pretty good. I wouldn’t sell anything.

[Freedom56]

Quote:

Originally Posted by COcheesehead You’ll get some capital gain in addition to the income so for that duration, I think you look pretty good. I wouldn’t sell anything.

Without knowing the cost basis, you can't say that there would be a capital gain. In managed accounts, they routinely buy over par just like funds do.

[COcheesehead]

Quote:

Originally Posted by Freedom56 Without knowing the cost basis, you can't say that there would be a capital gain. In managed accounts, they routinely buy over par just like funds do.

True. I was just comparing market to par. So from this point there is another $72,000 to gain.

[Katoslake]

Op here.

I do know I’m saving 0.45% in management fees this year, which is nice

[Freedom56]

Quote:

Originally Posted by COcheesehead True. I was just comparing market to par. So from this point there is another $72,000 to gain.

In any case, just investing 2023 and 2024 maturities at current yields will increase income significantly. This portfolio should eventually be able to generate about $60K a year with very conservative investments. (treasuries, agency notes, high grade corporates, CDs).

[Freedom56]

Quote:

Originally Posted by Katoslake Op here. I do know I’m saving 0.45% in management fees this year, which is nice

Go back and delete the post with your original spreadsheet. It has your account number embedded.

[orbops]

Not sure if this makes any difference, but if your capital gains are about 60-72K and you are filing married, the 12% tax bracket is $89,450 for 2023, so you're inching closer to the top of that bracket.

[Katoslake]

Quote:

Originally Posted by Freedom56 Go back and delete the post with your original spreadsheet. It has your account number embedded.

Moderators did it for me. What a stupid mistake on my part. I’ve taken several steps to correct my blunder
Thanks for the heads up ! Just moving too fast and not paying attention

[Freedom56]

Quote:

Originally Posted by Katoslake Moderators did it for me. What a stupid mistake on my part. I’ve taken several steps to correct my blunder Thanks for the heads up ! Just moving too fast and not paying attention

You may want to call Fidelity and ask them to assign to you a new account number and transfer your securities to that number just as a precaution.

[Katoslake]

Quote:

Originally Posted by Freedom56 You may want to call Fidelity and ask them to assign to you a new account number and transfer your securities to that number just as a precaution.

Thanks for that advice. Last night upon learning of my blunder I called Fidelity and blocked all online access. This morning I went in person and changed account number.
What an idiotic mistake on my part. It’s made me refocus on account security.
Even made me want to get an encrypted email account.

I’m done trying to post specific details. The advice you and others have provided is greatly appreciated !