Actually, you know what? That's it.
Never mind what I wrote above.
Moderator: Global Moderator
Actually, you know what? That's it.
Interesting move, dualstow. How much of your PP bonds did you sell and what percentage are you at now? And what would you do with the proceeds if you kept them in the PP?dualstow wrote:Well guys, and ladies,
I sold a bunch of my long bonds this morning at a bit above breakeven. Don't copy me, as nuanced thought did not come into play here.
If long bonds soar in price this year or next, I'll be happy about the ones I held onto. But, I don't think I would have made a significant amount of money by holding onto all of them.
It's been a nice run collecting the 3+% interest and knowing that I could hold on until I hit retirement age. And, I know that these bonds are for protection, not yield.
However:
- Some of these bonds are due to be sold in a few years anyway, per Harry's rule. They would have had only 20 years left on them.
- Despite what I said above about protection, it bothers me that new 10-years are earning nearly as much interest as my 30's.
- If we go into a Japan-style deflationary period, I'll get through it without these instruments.
So I'll have a smaller pp. No biggie.
buddtholomew wrote:how does this change your allocation?
Where did the sale proceeds go?
Budd, Soph (what light through yonder window breaks? )sophie wrote: ... How much of your PP bonds did you sell and what percentage are you at now? And what would you do with the proceeds if you kept them in the PP?
Nothing wrong with that at all.dualstow wrote:buddtholomew wrote:how does this change your allocation?
Where did the sale proceeds go?Budd, Soph (what light through yonder window breaks? )sophie wrote: ... How much of your PP bonds did you sell and what percentage are you at now? And what would you do with the proceeds if you kept them in the PP?
The short answer is that the allocation is way out of whack right now. It was a little under 40% of my 30-year bonds that I sold/am selling. I'm in a holding pattern right now. I know Harry never advised this, but I want to see where interest rates go from here. I'd be happy to buy long bonds in the future, but not right now.
And, I have no desire to sell gold or anything else to even things out. I'm just going to let the proceeds sit in Vanguard's prime money market fund until they return to long bonds or one of the other pp assets.
Someone correct me if I'm wrong but doesn't one get the "accrued interest" when selling bonds as dualstow is describing?dualstow wrote:I should add that it hurt a little that one was going to pay a bunch of interest in mid-May. But, I have held on to stocks I wanted to shed b/c I was waiting for the dividend, and that didn't end well.
This is just from a quick search, dualstow.dualstow wrote:Do I? How does that work, like a stock dividend’s date of record or something?
As of the end of the day today, the one-year rate is 2.28% and the 30-year rate is 3.10%. Not sure what to make of this flattening curve but I feel the same way, dualstow.dualstow wrote: ↑Sun May 06, 2018 8:36 am Sophie,
It’s not that I anticipate losses, though I guess I feel I avoided some. I just don’t think the ratio of risk/protection suits me right now. I’m not dissolving the rest of the pp. However, I’ll surrender that protection for now, and I’ll get pretty good yield on shorter term notes.
Again, I know it’s not supposed to be about yield.
If we go into 30 years of deflation and I only have this small batch of long bonds left, I’ll be ok.