I'm not sure that I understand the distinction between that and "find(ing) the sweet spots geographically / on the credit spectrum / along the maturity curve"By the word "active" in the subject line, I do NOT mean managers & strategies trying to bet on unknowable factors, like direction and timing of interest rates or rates of default or whatever...
? Isn't the "sweet spot" dependent on the timing and direction of interest rates?
Anyway, I use some managed bond funds. I mostly just look at the ones with good medalist ratings (Gold, maybe Silver) by Morningstar that also have relatively low expenses. Since I want the fund to have flexibility, I look at the core+, global bond, and multisector bond categories for candidates.
This doesn't leave many to consider. For example in the "global bond" category there's 4 gold rated, but only one with a reasonable ER (DODLX at 0.45%). Neither of the two silver rated has a reasonable ER. If I go to bronze there's a DFA fund (DFSHX) at an ER of 0.16%, but I don't think that I can buy it (Schwab shows it as "restricted". None of the rest of the bronze have a reasonable ER. I'd not be interested in ETFs that are probably going to be low volume and own illiquid bonds.
Besides allowing a manager to manage, part of my reasoning has been that I wanted to minimize the treasuries in our bond funds and, in effect, substitute CDs for them. I think, on average, I've gotten around 0.5% higher yield via CDs vs. comparable treasuries (this is in an IRA).
Statistics: Posted by jeffyscott — Tue Jul 02, 2024 8:47 am — Replies 1 — Views 253