All Treasury Portfolio

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Jeffreyalan
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All Treasury Portfolio

Post by Jeffreyalan » Mon Jun 25, 2018 9:22 am

I would like to get the advice of people on this board as I respect your opinions and viewpoints immensely. I am turning 50 this year and have about 15 years until retirement (I hope). So what would be the drawbacks of an all-Treasury portfolio?

If the purpose of the PP is to protect against various economic cycles, couldn't I replicate that with a Treasury portfolio? I-Bonds and TIPS for inflation protection. EE bonds or 10 year Treasuries for deflation. Short Term Treasuries for cash. Really the only thing I would not be protected against would be a catastrophic government default or similar. Otherwise the "sleep at night factor" should be awesome with this portfolio, although obviously the return would be much lower than a standard PP. Ultimately though I feel like I would still be protected in most economic scenarios with very limited risk or downside. Opinions?
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pugchief
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Re: All Treasury Portfolio

Post by pugchief » Mon Jun 25, 2018 10:45 am

You already answered your own question. If you don't care about growth (and possibly even anti-growth from inflation), you will have a peaceful slumber each night. Unless of course the US government defaults.
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ochotona
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Re: All Treasury Portfolio

Post by ochotona » Mon Jun 25, 2018 11:59 am

pugchief wrote:
Mon Jun 25, 2018 10:45 am
You already answered your own question. If you don't care about growth (and possibly even anti-growth from inflation), you will have a peaceful slumber each night. Unless of course the US government defaults.
Pursuant to the default idea... I have decided not to buy Treasuries much further out than my retirement date. I retire in 8 years. I could accept buying a ladder from 8 - 12 years out, centered around 10. I'm not sure I trust the government beyond that, and there's no point. The 10-30 yield curve is flat as a pancake.

I need to fund a Social Security replacement, since I'm going to claim benefits at 70., that's why it makes sense to have those bonds turning into cash 8 - 12 years from now.
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pugchief
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Re: All Treasury Portfolio

Post by pugchief » Mon Jun 25, 2018 1:20 pm

ochotona wrote:
Mon Jun 25, 2018 11:59 am
pugchief wrote:
Mon Jun 25, 2018 10:45 am
You already answered your own question. If you don't care about growth (and possibly even anti-growth from inflation), you will have a peaceful slumber each night. Unless of course the US government defaults.
Pursuant to the default idea... I have decided not to buy Treasuries much further out than my retirement date. I retire in 8 years. I could accept buying a ladder from 8 - 12 years out, centered around 10. I'm not sure I trust the government beyond that, and there's no point. The 10-30 yield curve is flat as a pancake.

I need to fund a Social Security replacement, since I'm going to claim benefits at 70., that's why it makes sense to have those bonds turning into cash 8 - 12 years from now.
So what do you plan to do about the bond portion of your PP after you retire? T-bills only? 5 year ladder? CDs?
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ochotona
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Re: All Treasury Portfolio

Post by ochotona » Mon Jun 25, 2018 5:35 pm

I intend to see how the position of the US government evolves over time and plan accordingly.
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eufo
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Re: All Treasury Portfolio

Post by eufo » Mon Jun 25, 2018 5:50 pm

Don't underestimate the risk of an all bond portfolio. Rising rates or severe inflation will crush you. I wouldn't trust TIPs to save you from inflation.
Don't agree with me too strongly or I'm going to change my mind
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ochotona
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Re: All Treasury Portfolio

Post by ochotona » Mon Jun 25, 2018 6:14 pm

eufo wrote:
Mon Jun 25, 2018 5:50 pm
Don't underestimate the risk of an all bond portfolio. Rising rates or severe inflation will crush you. I wouldn't trust TIPs to save you from inflation.
Agreed. I think I-Bonds are ok, there is no interest rate risk, if the interest rate for your set of bonds is no good, just redeem them.

Got to have a little gold a little bit of equities. If only 10-15% each.
Dieter
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Re: All Treasury Portfolio

Post by Dieter » Mon Jun 25, 2018 9:42 pm

Or as Bernstein says, not less than 25% in both stocks and bonds.
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Re: All Treasury Portfolio

Post by clacy » Tue Jun 26, 2018 5:27 pm

I think a 15/15/70 portfolio would be much safer.

15% stocks / 15% gold / 70% bond ladder.
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Desert
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Re: All Treasury Portfolio

Post by Desert » Wed Jun 27, 2018 9:02 am

Historically, the efficient frontier (point of minimum volatility) has been around 20 percent stock.

https://primecapitalequities.com/philos ... t-frontier
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ochotona
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Re: All Treasury Portfolio

Post by ochotona » Wed Jun 27, 2018 9:35 am

Desert wrote:
Wed Jun 27, 2018 9:02 am
Historically, the efficient frontier (point of minimum volatility) has been around 20 percent stock.

https://primecapitalequities.com/philos ... t-frontier
Excellent finding
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Re: All Treasury Portfolio

Post by dualstow » Thu Jul 12, 2018 4:25 pm

What happened to PRTBX, the all-treasury fund from the people who brought you PRPFX? It's all treasurys and all-short term for the low, low price of 0.7% O0
Looks like it hasn't paid anything for a while, which is weird for an income fund. Closed?

http://www.permanentportfoliofunds.com/ ... folio.html
de-fang the snake, said my filipino kali instructor. Shortly after that, he hit me in the head with a rattan stick.
— Desert, 2016 (Nomad clothing thread)
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