Treasuries
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How do feel about treasuries right now? What maturities are you working with? Are you using TIPS or buying futures on inflation in your portfolios with treasuries? I’m curious what BondGuy thinks and anyone else working with bond clients, corp, muni, ect…
There is always a market for the shortest investment grade munis with 5%+ yield. I have been showing short corporate bond ladders to CD buyers unhappy with current CD rates. If you think inflation will be a factor, then it would be prudent to position TIPS; either direct purchases or through funds/ETFs. The key is to stay short and nimble to reduce volatility, but still lock in attractive yields.
I am using some 5-7 year maturity Treasury Zeros and splitting the ticket with either some decent mutual funds or slightly more growth oriented investments. I am using it to get some CD buyers off the sideline.
Outside of that, I can’t think of a good reason to use any (I am a rookie though).
I am buying TIPS exclusively (versus Treasuries). I often use TIP (the ETF), but you have to be careful about previously-issued TIPS that may already have some inflation adjustments built in. These could potentially lose value at some point if inflation slows.
Any consideration toward using a C-share TIPS mutual fund (like Hartford’s, for example)?
I have been using some C-share TIPS, different fund companies though. Easy way to hedge in case inflation jumps up. That makes me nervous because I do a lot of fixed income and don’t want to get burned if inflation hits hard. Bond Guy, any advice?