inquisitive
Recycles dryer sheets
- Joined
- Apr 7, 2008
- Messages
- 223
What determines the performance of treasury bond funds? As US debt is considered a safe investment, the only other factors that seem to play in are interest rates and supply/demand.
To take a specific example (although all the comparable funds I looked at had similar performance), FLBAX returned 20% this year, and the index on which it is based had a 7%+ return over the past 10 years. Am I right in thinking that the return over the next 10 yrs will not be nearly as good because interest rates are going to rise? What sort of return can I expect?
Why was the return so good this year, is it because of high demand because interest rates are currently low?
If I am limited to bond funds in a retirement account, what types of bond funds should I consider to diversify from equities, that would have equity-like returns and risk? Have also looked at corporate (lower grade) and international sovereign debt (am an aggressive investor).
To take a specific example (although all the comparable funds I looked at had similar performance), FLBAX returned 20% this year, and the index on which it is based had a 7%+ return over the past 10 years. Am I right in thinking that the return over the next 10 yrs will not be nearly as good because interest rates are going to rise? What sort of return can I expect?
Why was the return so good this year, is it because of high demand because interest rates are currently low?
If I am limited to bond funds in a retirement account, what types of bond funds should I consider to diversify from equities, that would have equity-like returns and risk? Have also looked at corporate (lower grade) and international sovereign debt (am an aggressive investor).