love watching Dave's presentations,..... I'm 63 and have learned lots gut ripping lessons over the years, since I've been involved in investing since I was 18..... the younger guys in their 20's who do these types of investing presentations are full of redbull and sugar with loads of enthusiasm, which is fun to watch young people so excited.... but the only challenge they have ever seen in the market is 2020 and maybe 2018... amusing to watch a 24 year old who thinks they have investing all figured out.... but I guess we felt that way too when we were their age..... does anyone remember the last few months of 2008, when the Dow was tearing up and down 1000 points in 45 minutes...
The catch with I Bonds, which you can hold on to for up to 30 years, is this: You may not cash it out in the first year. And to get the full amount of interest owed, you have to hold the bond for at least five years. Otherwise, you will sacrifice three months of interest.
There is a difference between bonds and bond funds and this may warrant an explanation unless you did this in another video. I also calculated for a 5-year period from 2019 to the end of 2023 for total return and the compound annual compound return with dividends reinvested for the first 3 stocks in your list and they are different. A total return for BND of 5.6% and a compound annual return of 1.1%, for TLT of -9.0% and a compound annual return of -1.9% and for VTEB of 11.5% and a compound annual return of 2.2%. I may have done something wrong but could you check your numbers as I have checked mine. I also checked the percent change for just the closing price for my time frame and here are the results BND -7.2%, TLT -18.6 and VTRB 0.0%.
I used Yahoo daily data that was able to be downloaded to Excel (it was free now there is a charge). With this data I just did the math to get the return and I did check my results. I can show you how I did it but can't do it on this format.
Bond etfs seem good for current income but do most hold their value to keep up with inflation? Meaning do you think it would be good for income holding it for 10-20 years or more without reinvesting?
I think bonds are an important part of a portfolio but they tend to perform poorly during periods of high inflation. I always hold some bonds since it also gives me flexibility to move to stocks if there is a significant decline.
$SPHY is holding bonds for DISH Network, DirectTV, and Carnival Cruise..... I think they're all gonna be in serious trouble by full swing recession Q4. What's the chances of one of these bond ETF's eating some serious losses on default.......at least the corporate bond ETF's?
Hi Jeff. That is definitely worth consideration for a high yield bond ETF. It is fairly diverse but defaults will happen. I keep my exposure to around 3-5%. HYG handled the financial crisis well.
Hey Dave. Thanks for the video. Why are we taking additional risk when investing in the sphy? Is it because they don’t invest in classical gov bonds or why the risk is higher on this?
a stupid question : we know that I -bond and T-bonds are silver bullet against " black swan event " meaning that could not go down ( zero % ) ( factoring out inflation ) or if market goes down by 60% they donts ..... are theses ETF bond ( mentioned in this video ) immune from " black swan events " ? I mean , if i put 100 K in these ETF bond ( mentioned here ) , are there any risks that my 100 K becomes 40 K during a black swan event ?
Bond market will hold up better. Junk bonds will have more risk versus other bonds but they still are higher up the food chain if a default occurs versus stock holders.
@@wealthadventures Thnak you very much for reading my question , as always ... I guess my question is : from all these 3 low risk ETFs ( BND vs TLT VS VTEB ) listed in this BEAUTFUL TABLE ( 8:08 ) : which one is MORE bullet proof against POTENTAIL " black swan event ) ? I do like VTEB because has no federal tax ( MUNI bond ) and low expense ratio , BUT i would like to confirm with you about its resistance against black swan event . (I DO like very much TLT because it IS 90 % TB ( very robust against black swan event ) , but has higher expense ratio) ...please kindly advise
Why not? You can get 2 or 3% yield plus if interest will go down next year your bond will increase in price so you might get total return of 7-10%. And in 2-4 years if the market is back “to normal” sell yr bonds.
Just my personal opinion but I think with the current environment, bonds are a good option. We are close in age and on about the same track. I'm primarily buying treasuries directly and will continue as rates rise. However, you can also use bond ETFs. Bond ETFs will take time to catch up as old bonds fall off and are replaced by higher yielding bonds but they are convenient way to buy.
thx again.ive been investing for yrs...(&yrs!)but never bought a bond.do I call fidelity? talk to my bank?I'm curious that you buy bonds,but not interested in the etfs?I know there's a few questions in here,but always appreciate your insight! hope all is well otherwise with you&yours!✌️
Hi. You can call Fidelity and they can point you in the right direction. You can also check out treasury direct. I prefer to buy treasuries myself since I know exactly what I am buying. For example, a 6 month T bill pays about 5.1% at the moment and a 5 year about 4%. A similar bond ETF will pay less and yield will slowly rise as interest rates rise but you they are convenient since you can easily jump in and out of the fund.
SPHY is high yield so there is risk but I have found that the risk is worth it. It seems failures in the high yield market have historically been under expectation.
Interesting how there are so many videos on RUclips about T-bills and bonds lately. I take it as a barometer for where the stock market is heading; that is dddooowwnnn.
@@wealthadventures that's right. I'm currently 30% in BIL and SGOV. As 💩 hits the fan, I plan to move those funds over to SCHD and DGRO.. I guess aim a little bit of a trader.
Dear coach , I am not sure how familiar you are with G Fund( government BOND ) in TSP plan , which is an equivalent to 401 K for government employees ...... I would like to transfer my TSP plan to IRA fidelity , BUT I don't know which BOND is exactly the same of G fund in TSP ( watched so many videos , and they are saying is a combination of I-Bond and T bonds? ) ....... from your presentation it seems TLT could be a replacement ????? I don't know ? any idea in this area of TSP and G fund conversion ???
I do buy a small amount of BND (my preference) each week and I own some SPHY... but as rates are increasing for treasuries I'm not sure high yield is worth it. Not much of a gap between the 2. If you are willing to do a bit of work, I would build a bond ladder and start buying your own treasuries. I plan on doing a video about it in the near future.
Hi. That is my preference as well but some like to keep it as simple as possible. BND and TLT are loaded up with old bonds. As those get replaced with new higher yielding bonds the fund yield will start to rise. However, it takes time! BND was yielding about 2.12% at the beginning of 2022 and is now at 2.67%. Slow journey!
@@wealthadventures Thanks for explaining that! Under 3% is a little too slow for me. I've been buying individual bills and notes in the secondary market on Fidelity and it is definitely a little tricky. Very often I'm buying an older note that only has one year left on it with a coupon etc. and it's being sold at enough of a discount for me to get close to the headline yield. If you do a video on your experience, I think people will really benefit from it.
@themrfabio2459 Have you looked at TLTW? It's yielding 20%. And yes I agree with you that now is a good entry on TLT. I think 99 will hold and if something breaks we could easily be back above 110. Good luck
If you own the ETF or stock at the end of the trading day before the ex-dividend date, you will receive its next payout. In other words, you can buy it prior to the market close and receive the dividend. Be aware that a dividend will reduce the share price by an equal amount.
Hi. I don't disagree with that idea. My largest holding is my money market but I am slowly adding some shorter and longer duration bonds as well. Not bond funds, but bonds. The argument for longer duration bonds (and bond funds to a lesser extent) is that if/when rates fall, having some long duration bonds locked up will be a benefit. Rates may fall quickly including money market funds. Long term bonds will see a nice increase in value.
I had never even heard of an I-bond! Seems like a no brainer to make a maximum contribution to that every year along with the Roth. Thanks much!
Hi. I think so. It is on my short list each year!
Thanks, Dave and yes, T-bill video would be great! I do have some TIPs but have a $10k limit per head. Would love to hear about shorter term!
Hey Jeff. Will do!
Outstanding Commentary!!! Priceless!!! Thank You!!
Thank you!
Another interesting option is HYGW. It is a newer ETF that has a high dividend yield.
Thanks Dave. Another quality video and I like the comparison chart at the end. 🙋♂️👍
Thanks James!
Nice job on your muni purchase. There is definitely competition to the stock market right now. Nice information as always.
Thanks Richard! Not the most exciting investment in the world but I'm perfectly fine with that at the moment. This was an interesting week!
love watching Dave's presentations,..... I'm 63 and have learned lots gut ripping lessons over the years, since I've been involved in investing since I was 18..... the younger guys in their 20's who do these types of investing presentations are full of redbull and sugar with loads of enthusiasm, which is fun to watch young people so excited.... but the only challenge they have ever seen in the market is 2020 and maybe 2018... amusing to watch a 24 year old who thinks they have investing all figured out.... but I guess we felt that way too when we were their age..... does anyone remember the last few months of 2008, when the Dow was tearing up and down 1000 points in 45 minutes...
I certainly do! Thanks for watching.
The catch with I Bonds, which you can hold on to for up to 30 years, is this: You may not cash it out in the first year. And to get the full amount of interest owed, you have to hold the bond for at least five years. Otherwise, you will sacrifice three months of interest.
Good points. Thanks for contributing.
its only 3 months,,,not a big deal..
Another interesting option is ANGL. It has performed well over the last 10 years.
Yup. Thanks for sharing.
I own it along with Vanguard mutual fund VWEHX. Love high yield bonds
Dave the best person to make you money.
Ha! Thanks for the confidence boost.
I would couple BND with TFLR for a diverse portfolio. The second fund is a floating rate bund in the bank loan category.
Interesting. I will check it out. Thanks!
Good information. Very few videos on bond portfolio on youtube due to lack or interest or seems boring to most.
Thanks! More investors are paying attention these days with higher rates. Not a bad time to lock up some duration.
Great video!
Thanks!
There is a difference between bonds and bond funds and this may warrant an explanation unless you did this in another video. I also calculated for a 5-year period from 2019 to the end of 2023 for total return and the compound annual compound return with dividends reinvested for the first 3 stocks in your list and they are different. A total return for BND of 5.6% and a compound annual return of 1.1%, for TLT of -9.0% and a compound annual return of -1.9% and for VTEB of 11.5% and a compound annual return of 2.2%. I may have done something wrong but could you check your numbers as I have checked mine. I also checked the percent change for just the closing price for my time frame and here are the results BND -7.2%, TLT -18.6 and VTRB 0.0%.
I can check. What program did you use when you ran your numbers?
I used Yahoo daily data that was able to be downloaded to Excel (it was free now there is a charge). With this data I just did the math to get the return and I did check my results. I can show you how I did it but can't do it on this format.
I am not sure which is better? Bonds ETFs or covered calls options ETFs or REITS ETFs for income.
I think they can all serve a role in a balanced portfolio... but I would not get in bed with any one in particular.
Role
@@jedwards1792 Corrected!😆Keep looking and you will find many more.
I have half of these since 3 years can't complain no matter what market is doing
Very good information and explaination. Thank you.
Glad it was helpful!
Bond etfs seem good for current income but do most hold their value to keep up with inflation? Meaning do you think it would be good for income holding it for 10-20 years or more without reinvesting?
I think bonds are an important part of a portfolio but they tend to perform poorly during periods of high inflation. I always hold some bonds since it also gives me flexibility to move to stocks if there is a significant decline.
$SPHY is holding bonds for DISH Network, DirectTV, and Carnival Cruise..... I think they're all gonna be in serious trouble by full swing recession Q4. What's the chances of one of these bond ETF's eating some serious losses on default.......at least the corporate bond ETF's?
Hi Jeff. That is definitely worth consideration for a high yield bond ETF. It is fairly diverse but defaults will happen. I keep my exposure to around 3-5%. HYG handled the financial crisis well.
HYGH good for you very good for you and HYGW
Invesco IVR is a very good way to make money too buy a lot.
Hey Dave. Thanks for the video. Why are we taking additional risk when investing in the sphy? Is it because they don’t invest in classical gov bonds or why the risk is higher on this?
I guess no answer
What do you think about TLTW? It is down quite alot and I wonder it is a good buy.
Could be a decent option if you want to avoid options yourself. I would probably DCA in over the coming months.
a stupid question : we know that I -bond and T-bonds are silver bullet against " black swan event " meaning that could not go down ( zero % ) ( factoring out inflation ) or if market goes down by 60% they donts ..... are theses ETF bond ( mentioned in this video ) immune from " black swan events " ? I mean , if i put 100 K in these ETF bond ( mentioned here ) , are there any risks that my 100 K becomes 40 K during a black swan event ?
Bond market will hold up better. Junk bonds will have more risk versus other bonds but they still are higher up the food chain if a default occurs versus stock holders.
@@wealthadventures Thnak you very much for reading my question , as always ... I guess my question is : from all these 3 low risk ETFs ( BND vs TLT VS VTEB ) listed in this BEAUTFUL TABLE ( 8:08 ) : which one is MORE bullet proof against POTENTAIL " black swan event ) ? I do like VTEB because has no federal tax ( MUNI bond ) and low expense ratio , BUT i would like to confirm with you about its resistance against black swan event . (I DO like very much TLT because it IS 90 % TB ( very robust against black swan event ) , but has higher expense ratio) ...please kindly advise
I’m 54 years old and plan to retire at 65 our bond ETF so good idea at my age
Why not? You can get 2 or 3% yield plus if interest will go down next year your bond will increase in price so you might get total return of 7-10%. And in 2-4 years if the market is back “to normal” sell yr bonds.
Just my personal opinion but I think with the current environment, bonds are a good option. We are close in age and on about the same track. I'm primarily buying treasuries directly and will continue as rates rise. However, you can also use bond ETFs. Bond ETFs will take time to catch up as old bonds fall off and are replaced by higher yielding bonds but they are convenient way to buy.
Good video. TMV and TMF. TMF just started. What about COMB?
COMB is new to me... I will take a look!
thx again.ive been investing for yrs...(&yrs!)but never bought a bond.do I call fidelity? talk to my bank?I'm curious that you buy bonds,but not interested in the etfs?I know there's a few questions in here,but always appreciate your insight!
hope all is well otherwise with you&yours!✌️
Hi. You can call Fidelity and they can point you in the right direction. You can also check out treasury direct. I prefer to buy treasuries myself since I know exactly what I am buying. For example, a 6 month T bill pays about 5.1% at the moment and a 5 year about 4%. A similar bond ETF will pay less and yield will slowly rise as interest rates rise but you they are convenient since you can easily jump in and out of the fund.
I'm looking ijot SPHY , 66 years old, lots of stocks and etfs, but no bonds.
SPHY is high yield so there is risk but I have found that the risk is worth it. It seems failures in the high yield market have historically been under expectation.
Interesting how there are so many videos on RUclips about T-bills and bonds lately. I take it as a barometer for where the stock market is heading; that is dddooowwnnn.
Perhaps! It is all about equity risk premium. As the risk free rate rises (T bills), less people are willing to RISK their money in the stock market.
@@wealthadventures that's right. I'm currently 30% in BIL and SGOV. As 💩 hits the fan, I plan to move those funds over to SCHD and DGRO.. I guess aim a little bit of a trader.
Dave what do you think about BND? I own schg , schd , some individual blue chips stocks and im looking to add a bond fund? Thank you
BND is good basic bond fund. I use it with one of my base M1 accounts.
So to get 60$ I have to spend 600k?
No. That seems incorrect. What product are you looking at?
@wealthadventures I just bought some bonds, but im on Robinhood.
Dear coach , I am not sure how familiar you are with G Fund( government BOND ) in TSP plan , which is an equivalent to 401 K for government employees ...... I would like to transfer my TSP plan to IRA fidelity , BUT I don't know which BOND is exactly the same of G fund in TSP ( watched so many videos , and they are saying is a combination of I-Bond and T bonds? ) ....... from your presentation it seems TLT could be a replacement ????? I don't know ? any idea in this area of TSP and G fund conversion ???
Not sure on this one. Sorry I don't think I can help.
Thank you for reading my question !
There is NO bond fund that is like G fund.I moved most of my Thift Savings but kept some in G fund.
@@bobdole7701 thank you !
@Dave I'm watching a year later, July 2024, do you think is it still good time to invest in bond ETF's ?
If the fed starts to cut rates, it could be a good time to pickup some bond funds that have longer duration.
Thoughts on TIP & STIP?
I'm on the fence... I personally will not invest at the moment because I feel that there are better options.
So which one do you prefer?
I do buy a small amount of BND (my preference) each week and I own some SPHY... but as rates are increasing for treasuries I'm not sure high yield is worth it. Not much of a gap between the 2. If you are willing to do a bit of work, I would build a bond ladder and start buying your own treasuries. I plan on doing a video about it in the near future.
@@wealthadventures any update video on this?
@@OrlandoFL16 Not yet but happy to work on one. Are you looking for something in particular?
@@wealthadventures TLT and BND maybe?
@@OrlandoFL16 ok!
Thanks 😉
Thank you!
Why is the yield on TLT and BND so low??? There is definitely potential for capital gains there but I'm sticking with my own T-Bill ladder
Hi. That is my preference as well but some like to keep it as simple as possible. BND and TLT are loaded up with old bonds. As those get replaced with new higher yielding bonds the fund yield will start to rise. However, it takes time! BND was yielding about 2.12% at the beginning of 2022 and is now at 2.67%. Slow journey!
@@wealthadventures Thanks for explaining that! Under 3% is a little too slow for me. I've been buying individual bills and notes in the secondary market on Fidelity and it is definitely a little tricky. Very often I'm buying an older note that only has one year left on it with a coupon etc. and it's being sold at enough of a discount for me to get close to the headline yield. If you do a video on your experience, I think people will really benefit from it.
I think now is the time to basically go all in on TLT.
@themrfabio2459 Have you looked at TLTW? It's yielding 20%. And yes I agree with you that now is a good entry on TLT. I think 99 will hold and if something breaks we could easily be back above 110. Good luck
@@themrfabio2459 Still a chance it goes lower if inflation comes back, but I agree this is the time to start a position.
What if your bond funds like VWESX -$4985, VCLT -$3298 are way down. Should I sell and try something else?
I own a few bond funds. I plan on holding them.
What's the minimum time you need to hold one of those to get its dividends?
If you own the ETF or stock at the end of the trading day before the ex-dividend date, you will receive its next payout. In other words, you can buy it prior to the market close and receive the dividend. Be aware that a dividend will reduce the share price by an equal amount.
@@wealthadventures I appreciate it
Why not just continue to chill with vanguard money market at 4.6% and buy bonds later?
Hi. I don't disagree with that idea. My largest holding is my money market but I am slowly adding some shorter and longer duration bonds as well. Not bond funds, but bonds. The argument for longer duration bonds (and bond funds to a lesser extent) is that if/when rates fall, having some long duration bonds locked up will be a benefit. Rates may fall quickly including money market funds. Long term bonds will see a nice increase in value.
iShares HYGH, HYGW?
Ck out tltw 20% Ann. This month.
Will do!
White Anna Allen Frank Johnson David
HYGH cost lower than tit, and more
You have intense blue eyes.
Scary stuff huh!😀