Just a quick idea in case it hasn't been mentioned: With individual TIPs bought on the secondary market, you can "sorta kinda" reduce reinvestment risk by choosing the bond with the LOWEST coupon for any particular rung. So all the "income" will come from inflation factor. The risk of course is that bond with the lowest coupon, say .125% RR in a 2% RR environment is that you can for example pay 15K for a 10K bond, 5K of which is inflation factor, which is NOT protected against DEFLATION should that occur. TIPSguy tells me this is a decent strategy, and that the deflation risk is probably pretty small. (Forgive me if I'm less than scientific and precise with my explanation...I tend to grasp these things intuitively, but have a hard time expressing them technically correct)
Statistics: Posted by hotwired — Mon Jan 08, 2024 4:17 am — Replies 29 — Views 2635