re: Bought US Treasury 1y

quote:

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Stock market dips creating a good buying opportunity so you go and buy bonds? What’s the reasoning behind this?

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I don’t think anyone is suggesting that you make bonds your primary investment strategy. I’d revisit that idea only if we hit 8%. If that happens; I’m buying some 20’s.

Many of us; including myself, have some amount of cash reserves or what many call a “rainy day fund”. An amount of money you keep aside uninvested. Money that you want to be high in liquidity.

For me; that money has spent the past decade sitting in a savings account accumulating absolutely minimal interest. I look at the Treasuries as being a somewhat less liquid alternative; but, with a major upside in terms of earning considerable risk free interest. If I need the cash immediately, I can simply sell them on the secondary market.

To be sure, I’m still maxing out my 401(k) and IRAs, and continue to buy stocks in my private brokerage account. Been buying the dips all the way down. The old adage is diversification is best. Bonds for the first time in my adult life are finally part of that.