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Message
re: Holding Bond Funds at 40 years old
Posted on 4/3/21 at 9:45 am to buffbraz
Posted on 4/3/21 at 9:45 am to buffbraz
I don’t have any money in Bonds. I do like some dividend ETF’s as an alternative. A personal outperformer in recent months has been MORT.
A mortgage REIT, it generates revenue from holding mortgages as opposed to actual physical real estate. At $18-19 per share it’s currently returning about $1.50 per share in dividends annually. About 8% with some years better than 15%. Far better than Bonds. Like any other REIT, it has to return all earnings to its shareholders and with the current housing boom its share price is still $5 off its pre-COVID highs.
I don’t see mortgage interest rates rising in the short term; however, I think eventually they will and given the tougher lending standards combined with the fact that the Fed owns 20-30% of US mortgages I think there’s some insurance and upside long term.
Of course there’s risk in any investment. YMMV
A mortgage REIT, it generates revenue from holding mortgages as opposed to actual physical real estate. At $18-19 per share it’s currently returning about $1.50 per share in dividends annually. About 8% with some years better than 15%. Far better than Bonds. Like any other REIT, it has to return all earnings to its shareholders and with the current housing boom its share price is still $5 off its pre-COVID highs.
I don’t see mortgage interest rates rising in the short term; however, I think eventually they will and given the tougher lending standards combined with the fact that the Fed owns 20-30% of US mortgages I think there’s some insurance and upside long term.
Of course there’s risk in any investment. YMMV
This post was edited on 4/3/21 at 9:50 am
0
Posted on 4/3/21 at 9:48 am to RoyalWe
quote:
Math is math! I assure you my returns are calculated including holding bonds. I'm quite happy.
Ummm. If you have 30% not in the market. And that 30% of funds buys a market dip and the dip recovers to 100%... all you did was make up the opportunity cost of not having the 30% in the market.
If your 30% bonds were set aside at a lower market point than the dip (the shite continually goes up and has for 120 years), then you havent fully recovered the opportunity cost. Have you?
Math isnt hard. Im happy that you caught the dip in february. Lol
Posted on 4/3/21 at 10:36 am to meansonny
quote:I've posted at length what I do on this message board and this isn't it. I don't time the market. My buying the dip was just a reaction to prices at the end of the quarter just as my selling was a reaction to how well they performed. I'm just following a formula with no emotion involved. I also use leveraged funds.
Ummm. If you have 30% not in the market. And that 30% of funds buys a market dip and the dip recovers to 100%
Posted on 4/4/21 at 9:35 am to RoyalWe
People think you can only make the coupon on bonds. Do you trade ETNs or actual bonds?
Posted on 4/4/21 at 11:06 am to wutangfinancial
I only buy total bond market index ETFs. This works for my strategy as I am truly only using it as a place to put money when my leveraged ETFs out-perform according to my quarterly expectation and to draw from when they underperform. I get the yield dividend and the price fluctuation.
Posted on 4/5/21 at 7:58 am to buffbraz
Put 90% in growth and buy in on the dips.
Posted on 4/5/21 at 9:22 am to RedlandsTiger
I love how the growth crowd is the same as the inflation crowd and they don't realize how contradictory those two scenarios are
Posted on 4/8/21 at 3:06 pm to RedlandsTiger
quote:
Put 90% in growth and buy in on the dips.
Oof.. you gonna be disappointed when you learn growth has extended periods of underperformance too. Look historically and tell me that growth is always where you have to be.
Posted on 4/8/21 at 8:14 pm to LSUcam7
How extended are you referencing and which fund? The total stock market?
Vanguard Total Stock Market ETF VTI Since Inception 8.81% 10 yrs 10.39%
NASDAQ
Invesco QQQ Trust QQQ 8.81% 10 yrs 20.61%
Growth is a no brainer if you're in it for the long run. We are not in 1999.
Vanguard Total Stock Market ETF VTI Since Inception 8.81% 10 yrs 10.39%
NASDAQ
Invesco QQQ Trust QQQ 8.81% 10 yrs 20.61%
Growth is a no brainer if you're in it for the long run. We are not in 1999.
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