daylatedollarshort
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
- Joined
- Feb 19, 2013
- Messages
- 9,358
okay someone here please correct me if I am wrong but it seems to me like if I buy a bond fund on Jan. 1 2022 with a 7 year duration yielding 3% that theoretically if I hold that fund for 7 years I will realize 3% dividends based on whatever the price was on Jan.1, 2022...I realize there will likely be different share price but assuming I do not sell I would still have realized a 3% annual yield.. Am I wrong?
In an open ended bond fund, the bond fund managers are actively selling and buying bonds at prevailing interest rates, which may be higher or lower than 3%, as shares get bought and redeemed and interest rates change over time.
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