I made some significant portfolio allocation changes toward intermediate term bond funds and away from 100% equities roughly in the same timeframe. Lucky me. Would not sell right now.
My plan, as far as it goes, is to:
1) Know the average durations of the funds I purchased
2) Check in on total return since purchase of the funds when I reach 1x average duration
3) Make a decision at that time to either keep my bond allocation in those funds or move some/all to shorter term
The first time this comes up for me is next year. I'll be fine continuing to hold a bond fund past 1x average duration if I'm happy with the long-term trend at that time relative to other investments.
Interestingly, there is now a 2.5 year difference between duration (shorter) and maturity in VBTLX, I think implying the fund is reducing interest rate risk?
My plan, as far as it goes, is to:
1) Know the average durations of the funds I purchased
2) Check in on total return since purchase of the funds when I reach 1x average duration
3) Make a decision at that time to either keep my bond allocation in those funds or move some/all to shorter term
The first time this comes up for me is next year. I'll be fine continuing to hold a bond fund past 1x average duration if I'm happy with the long-term trend at that time relative to other investments.
Interestingly, there is now a 2.5 year difference between duration (shorter) and maturity in VBTLX, I think implying the fund is reducing interest rate risk?
Statistics: Posted by cbs2002 — Wed Jul 10, 2024 10:37 am — Replies 21 — Views 2130