Telly
Thinks s/he gets paid by the post
- Joined
- Feb 22, 2003
- Messages
- 2,395
A few years ago when the market was up and I rebalanced (has it really been that long ago?!), I rebalanced into Money Market rather than Bond Funds like I usually would. That unusual move on my part turned out to be good. But time is getting on. The Money Market return is now 0, but at least I'm not losing capital... well, I am, I'm not keeping up with inflation on those $ now.
It seems I should be moving those MMkt. $ over to a Bond Fund, but there has been this thought of interest rates increasing right around the corner. But it hasn't happened yet, for all the talk of it. And now I see more about it being a ways off. So rising rates that seemed imminent, now seem indeterminate.
This is all in an IRA, and I do not plan on tapping it for many years.
I guess the usual thought would be to go to a short term bond fund to limit the downside when an upside in interest rates occurs.
But I just can't seem to do it... decision paralysis... stuck... not moving...
Any thoughts?
And is a bond fund with a 3 year duration short enough to minimize a big loss on the eventual interest rate increase? It has a higher return than a short-term fund of only 1.n years duration. Risk/reward balance between those two durations?
Any thoughts appreciated!
It seems I should be moving those MMkt. $ over to a Bond Fund, but there has been this thought of interest rates increasing right around the corner. But it hasn't happened yet, for all the talk of it. And now I see more about it being a ways off. So rising rates that seemed imminent, now seem indeterminate.
This is all in an IRA, and I do not plan on tapping it for many years.
I guess the usual thought would be to go to a short term bond fund to limit the downside when an upside in interest rates occurs.
But I just can't seem to do it... decision paralysis... stuck... not moving...
Any thoughts?
And is a bond fund with a 3 year duration short enough to minimize a big loss on the eventual interest rate increase? It has a higher return than a short-term fund of only 1.n years duration. Risk/reward balance between those two durations?
Any thoughts appreciated!