Yield and YTD return

[smooch]

I know I am asking some very basic questions, but I’m just learning, so I hope you don’t mind. We are invested in PIMCO Real Return (PRTNX). If the yield is 4.62%, according to Morningstar, how can the YTD return be .71? I would have thought the return would also be 4.62%.

 

[JPatrick]

I know I am asking some very basic questions, but I’m just learning, so I hope you don’t mind. We are invested in PIMCO Real Return (PRTNX). If the yield is 4.62%, according to Morningstar, how can the YTD return be .71? I would have thought the return would also be 4.62%.

Generally YTD reflects the change in NAV after adding div.  I'd bet your chart is heading south.  Yield probably reflects the divs paid. You can earn nice divs, but if the overall value goes down so does your overall return.  Bad year for bonds

 

[smooch]

So this fund had a negative return. It has an expense ratio of 1.4%. Morningstar classifies it as Long Government. Should we be in this kind of fund at all? I'm looking for a Vanguard fund to replace it. I see the Long Term Bond Index, which has an ER of .18% and has a YTD return over 2%. But I thought I also read on here that it is not a good time for long term bonds. Is Long Gevernment the same as long term bond? Is there a better option?

 

[brewer12345]

1.4% expense ratio on a bond fund is outrageous. If you decide to stick with long govt bonds, at least find a cheaper fund. Vanguard offers cheaper funds, and there is an exchange-traded long govt bond fund (TLT) that is a lot cheaper than that.

Personally, I don't think long bonds are a real great place to be right now. I'd probably stick with medium term or something like the Lehman Aggregate bond index. Either that, or go find a high yielding CD. Looks like you can get CDs yielding 5% or better with terms of a couple of years.