The Bond Dream Room

[Ad Orientem]

Fun perspective.

Record set on 30 year us bonds:

https://www.nytimes.com/1982/02/05/busi ... bonds.html

Ding ding, all time highs. So much for all those people that were convinced the bond bull was dead and that yields had nowhere to go but up.

All bow before the genius of Harry Browne. The future is indeed unpredictable. Here we are with the HBPP being lifted in large part by what I think can be safely called its most unpopular component. I can't count the number of times I have ground my teeth at the thought of that giant allocation to a doomed asset.

[modeljc]

Fun perspective.

Record set on 30 year us bonds:

https://www.nytimes.com/1982/02/05/busi ... bonds.html

Ding ding, all time highs. So much for all those people that were convinced the bond bull was dead and that yields had nowhere to go but up.

All bow before the genius of Harry Browne. The future is indeed unpredictable. Here we are with the HBPP being lifted in large part by what I think can be safely called its most unpopular component. I can't count the number of times I have ground my teeth at the thought of that giant allocation to a doomed asset.

BOY I hear that! You are so right! I did sell a very little today just to feel I had shorten the duration just a fraction. Wow I just can't believe that we only have 600 or so worldwide on this board! What a overall bad allocation as we don't have any believers. Ground teeth is not what I feel. For me it's I am so dumb to have this allocation as we know rates are going a lot, lot higher.

[Tortoise]

Since 2010 when I started investing in the 4x25 PP, long-term Treasuries have been the most surprising asset by far.

It’s my least favorite PP asset that’s always the hardest for me to buy, but it keeps surprising me by swooping in to buoy the portfolio at unexpected times. It seems to perform the best when people are trash-talking it the most.

[ochotona]

Seems to me TLT starts to bang it's head on the ceiling when it hits 155. Click here, because darn it, Tinypic is going away.

https://drive.google.com/file/d/1e9kyV6 ... rHSm-/view

[ochotona]

Sorry chart is working now... Please look

[pmward]

Seems to me TLT starts to bang it's head on the ceiling when it hits 155. Click here, because darn it, Tinypic is going away.

https://drive.google.com/file/d/1e9kyV6 ... rHSm-/view

Trend channels can be broken out of, and generally when that happens the old resistance line becomes the lower support line going forward. With our Fed I wouldn't be surprised if this happens in the coming years. That being said, they are considered strong resistance when tested 3 or more times, so it won't be easy. And even if we don't break above it, there's no reason why we can't just hug the line and follow it up. It is also an upward trending channel, and it's a strong upward trend, so just because we are close to the resistance level doesn't mean we have to pull back. If I were short term trading I wouldn't buy here, but for a PP like long term buy and hold, it's fine to still buy here. Better to buy here than not buy at all, imo.

[sophie]

Seems to me TLT starts to bang it's head on the ceiling when it hits 155. Click here, because darn it, Tinypic is going away.

https://drive.google.com/file/d/1e9kyV6 ... rHSm-/view

Trend channels can be broken out of, and generally when that happens the old resistance line becomes the lower support line going forward. With our Fed I wouldn't be surprised if this happens in the coming years. That being said, they are considered strong resistance when tested 3 or more times, so it won't be easy. And even if we don't break above it, there's no reason why we can't just hug the line and follow it up. It is also an upward trending channel, and it's a strong upward trend, so just because we are close to the resistance level doesn't mean we have to pull back. If I were short term trading I wouldn't buy here, but for a PP like long term buy and hold, it's fine to still buy here. Better to buy here than not buy at all, imo.

Horse race talk again?

Whether or not to buy a PP asset has nothing to do with trend channels, resistance lines, support lines, or whatever else is in here that I can't understand BC (before coffee). You buy to stay within your rebalance limits.

Do you guys mean that TLT might start becoming unstable for whatever reason? Possibly I guess...always better to hold the bonds directly if you can. ER 0 that way.

[dualstow]

Horse race talk again?

Whether or not to buy a PP asset has nothing to do with trend channels, resistance lines, support lines, or whatever else is in here that I can't understand BC (before coffee). You buy to stay within your rebalance limits.
...

+1

The economy and the movements of markets may be as complicated as the weather. Running a pp is about as simple as wearing a raincoat or bringing along an umbrella.

[pmward]

Seems to me TLT starts to bang it's head on the ceiling when it hits 155. Click here, because darn it, Tinypic is going away.

https://drive.google.com/file/d/1e9kyV6 ... rHSm-/view

Trend channels can be broken out of, and generally when that happens the old resistance line becomes the lower support line going forward. With our Fed I wouldn't be surprised if this happens in the coming years. That being said, they are considered strong resistance when tested 3 or more times, so it won't be easy. And even if we don't break above it, there's no reason why we can't just hug the line and follow it up. It is also an upward trending channel, and it's a strong upward trend, so just because we are close to the resistance level doesn't mean we have to pull back. If I were short term trading I wouldn't buy here, but for a PP like long term buy and hold, it's fine to still buy here. Better to buy here than not buy at all, imo.

Horse race talk again?

Whether or not to buy a PP asset has nothing to do with trend channels, resistance lines, support lines, or whatever else is in here that I can't understand BC (before coffee). You buy to stay within your rebalance limits.

Do you guys mean that TLT might start becoming unstable for whatever reason? Possibly I guess...always better to hold the bonds directly if you can. ER 0 that way.

Agreed, that's why I said that if someone is holding a PP they should not pay much mind to it. It's not that they might become unstable, it's just that we are close to resistance so the odds of a short to medium term pullback within the channel are increased. But like I mentioned, it is possible that we could actually break out above the channel line and really accelerate to the upside. Most importantly, it's still an upward trend so over the long term skies are still blue to the upside. So while he correctly pointed out that a couple days ago the resistance level channel line was about 155, it's slightly higher with each day, week, and month that passes. I'm personally not worried one bit about purchasing bonds in my GB with fresh cash at the moment. If I were looking to do a short to medium term trade however, I would look elsewhere.

[ochotona]

I showed my TLT chart to my wife she told me to sell some. I did when my tight trailing stop alert went off. More and more cash...

[dualstow]

I showed my TLT chart to my wife she told me to sell some. I did when my tight trailing stop alert went off. More and more cash...

Does she usually take in interest in charts? I can’t get my other half interested in investing, let alone the pp or charts. She likes math and science but...money is for spending.

[ochotona]

She's a scientist so she knows how to read charts and graphs. She also has that woman's intuition for when something is a good deal and when it is overpriced.

[pmward]

I showed my TLT chart to my wife she told me to sell some. I did when my tight trailing stop alert went off. More and more cash...

I'm not so sure cash is any better of an investment at this point in time. Cash is turning back into a fixed expense, lol. Seems to me like maybe trading something likely to go up for something almost sure to go down.

[sophie]

She's a scientist so she knows how to read charts and graphs. She also has that woman's intuition for when something is a good deal and when it is overpriced.

I'm trying very hard not to be offended by this discussion, but I'm failing miserably.

So it's my "women's intuition" that gets me publications in Nature journals, is it? And you're graciously admitting I might just know how to read charts and graphs? Geez guys...here's a news flash for you: your wives are intelligent human beings whose interests might or might not align with yours. We are not, contrary to popular belief, a different species of house pet.

[ochotona]

She's a scientist so she knows how to read charts and graphs. She also has that woman's intuition for when something is a good deal and when it is overpriced.

I'm trying very hard not to be offended by this discussion, but I'm failing miserably.

So it's my "women's intuition" that gets me publications in Nature journals, is it? And you're graciously admitting I might just know how to read charts and graphs? Geez guys...here's a news flash for you: your wives are intelligent human beings whose interests might or might not align with yours. We are not, contrary to popular belief, a different species of house pet.

I'm sorry, but you need to take a stress pill and think it over. I wasn't referring to you, I was referring to my wife. Also, she's the one who often talks about intuitive feminine ways of knowing, and how men lack them and get into trouble because they are wrapped up in their own head and their own ideas about how things should be instead of seeing how things are. Put another way by Dave Ramsey, "Men have no risk bone".

Men will talk and theorize about agricultural trade policy, and women do too, but women in many households are more prone to have to buy food and feed their families, which gives them more insights of a gut-level type.

[dualstow]

In case I'm one of the guys in "geez guys", let me just reiterate that she has the smarts but not the interest.

[Smith1776]

I've read some of the behavioural economics stuff dealing in this area of men vs. women in investing.

I don't doubt that women have just as good a capacity to understand stock market numbers, charts, and graphs as men do.

However, my understanding is that women generally get better investment results than men because they don't bother with paying attention to that data. Easier to stay the course when you ignore all that.

[pmward]

And we have another all-time high close in TLT. This bond rally just doesn't want to quit.

[Ad Orientem]

30 yr Treasury currently yield 1.95%
VOO current dividend 2.03%

Not seen that in a very long time.

[ochotona]

I'm just not getting excited about putting new money into TLT right here...

https://i2.wp.com/northmantrader.com/wp ... .png?ssl=1

For years and years, after TLT has hit the top of that trend, 6, 12, or 18 months later, investors were regretting buying at the peak.

[sophie]

Eh, that's what I was saying to myself when the 30 year yield was 2.5%.

Speaking of which, anyone hit a rebalance band yet?

[Ugly_Bird]

Speaking of which, anyone hit a rebalance band yet?

After this LTT and Au surge, mine is pretty well balanced now :-)

[Kbg]

In some other stuff I read, supposedly the gap between US interest rates and the rest of the world is projected to close and hence the movement in i-rates down.

[dualstow]

Eh, that's what I was saying to myself when the 30 year yield was 2.5%.

Speaking of which, anyone hit a rebalance band yet?

I might have if i hadn’t stupidly sold my “worst” bonds in 2018. With bonds up so much but still underweight in my allocation due to the sale, I guess I have to leave it alone.

Certainly not complaining though. It’s nice to see all four assets well in the black.

[pmward]

I'm just not getting excited about putting new money into TLT right here...

https://i2.wp.com/northmantrader.com/wp ... .png?ssl=1

For years and years, after TLT has hit the top of that trend, 6, 12, or 18 months later, investors were regretting buying at the peak.

I would still put money into TLT in the PP for a long term hold at this point. Even if odds of large return in the short timeframe you listed is not particularly high, the odds of large return on the longer term is still intact. I think the problem right now is that these markets are currently impossible to read on the short timeframe you listed. It's really a coin flip for each asset as to whether or not it will go up, tread sideways, or go down. Nobody has any clue what is going to happen right now. So personally, in my GB if on a DCA day bonds were my lowest asset, I would still put fresh cash into them even at the top of the channel. Now, that obviously hasn't happened in some time as bonds have rallied like crazy so most of my fresh money has been going into cash and stocks (ugh those small caps in particular, if anything the small caps are the asset that I'm loathe to be holding at the moment as technically they just have not a single sign of life going on; I'm very tempted to start moving some of these over to REIT's but selling an asset low to buy an asset high is something I find hard to pull the trigger on).