@dtconroe,
I am requoting my previous post for reference. I never had any bad experiences with CUs when I was their customer.

I can endorse CU as financial institutions, especially for their excellent customer service. I have dealt with them over the years. I never had large enough invested with them to worry about their balance sheet or how NCUA works. It seems they get into trouble far less than regional / community banks. Do your DD.
In the interest of full disclosure, I stopped doing business with them when cyber attacks of US businesses became more prevalent. Just my luck, a few years after I closed my account, Patelco CU had a cyber attack and my info was compromised.

@Derf - Maybe they’re out buying C/D s now to lock-in those back to back +24% years!
Thanks @JD_co for the numbers.

Use banks or CU for banking services. Use brokerages for brokerage banking services.
Why not use a brokerage for banking services?

In 1977, Merrill Lynch took a gamble with a concept known as a CMA (cash management account). This blending of banking and broker services into a one-stop-shop for financial services ...

https://www.sri.com/press/story/75-years-of-innovation-cash-management-account-cma/
Several brokerages offer cash management services. You can write checks and use a debit card from a Schwab brokerage account - you don't need Schwab bank for this.
https://www.schwab.com/content/how-to-order-new-debit-credit-card
You're not going to get a safe deposit box or take out a loan at a brokerage. But for your basic cash management and notary services, ISTM a brokerage can do just as well. And by using a brokerage for these services, that's one less account to have to deal with.

A couple of brief notes regarding credit unions:
- There is a shared network of brick and mortar CUs so that you can conduct some transactions in many locations (if your CU participates) even though individual CUs tend to have small footprints.
https://www.coop.org/Solutions/Engage/Co-op-Shared-Branch
- As Yogi noted, some CUs are privately insured through ASI. In 2002, Patelco moved to ASI, though five years later, it returned to NCUA. In 2002, ASI covered deposits up to $250K while NCUA coverage was limited to $100K (it's now $250K). Differences between ASI and NCUA can be more than just private vs government backing.

msf, I failed to mention that Kelley Credit Union stated that in addition to the $250,000 NCUA deposit insurance, per account, per owner, identical to FDIC, they also have an additional insurance coverage through a private insurance company, that doubles the NCUA/FDIC deposit coverage. How many banks do you think do that?

A couple of brief notes regarding credit unions:
- There is a shared network of brick and mortar CUs so that you can conduct some transactions in many locations (if your CU participates) even though individual CUs tend to have small footprints.
https://www.coop.org/Solutions/Engage/Co-op-Shared-Branch
- As Yogi noted, some CUs are privately insured through ASI. In 2002, Patelco moved to ASI, though five years later, it returned to NCUA. In 2002, ASI covered deposits up to $250K while NCUA coverage was limited to $100K (it's now $250K). Differences between ASI and NCUA can be more than just private vs government backing.

I can endorse CU as financial institutions, especially for their excellent customer service. I have dealt with them over the years. I never had large enough invested with them to worry about their balance sheet or how NCUA works. It seems they get into trouble far less than regional / community banks. Do your DD.
In the interest of full disclosure, I stopped doing business with them when cyber attacks of US businesses became more prevalent. Just my luck, a few years after I closed my account, Patelco CU had a cyber attack and my info was compromised.

BaluBalu'
Thanks for your personal experience, and I am sorry for your bad experience. I totally agree with "Do your DD". I have never experienced issues with Credit Unions that you experienced, but just like Banks, Credit Unions should be researched. My "bad experiences" have occurred with Banks. Woodforest National Bank use to be my primary bank, until I experienced Identity theft issues. Someone got into my checking account information, wrote some huge and numerous bad checks over the course of just a couple of days, forcing me to file a Police Report, get a new Drivers License, and close my banking account. In the process of dealing with these issues, the local police department informed me that they had many similar problems with Woodforest National Bank and encouraged me to get a new bank with better security for depositor accounts. Of course, I experienced numerous "bank problems" during the 2007/2008 financial crisis, with several banks that went bankrupt and had to close--the most well known bank was the Countrywide Bank, where I had several CDs. Fortunately, my CD investments were okay with FDIC protections, but it took a little time to clean up the Countrywide mess! I did my Due Diligence on local credit unions in Tyler, and although I have been using another Credit Union (CASE Credit Union), it was not as good as Kelley Credit Union when it came to Share Certificates/CDs. As you said do your Due Diligence, and gather some quality information before making your financial decision.

I can endorse CU as financial institutions, especially for their excellent customer service. I have dealt with them over the years. I never had large enough invested with them to worry about their balance sheet or how NCUA works. It seems they get into trouble far less than regional / community banks. Do your DD.
In the interest of full disclosure, I stopped doing business with them when cyber attacks of US businesses became more prevalent. Just my luck, a few years after I closed my account, Patelco CU had a cyber attack and my info was compromised.

For those few posters still reading this, who have interest in CDs, I just checked Schwab CD offerings. Lots of callables paying 4.4% and more, but interestingly there are non-callables being offered at 4% for 2 and 3 years by major well-known banks. That strongly suggests that CD rates may not be dropping that much more in the near future.

Why look at EXDAX when ICMUX performance for 1-3-5 years is so much better with a lower SD.
ICMUX doubled EXDAX for 1 year and more than doubled for 5 years.

Smallish nips of NSRGY & FLO. Like the X girlfriend or wife you can’t quite get over. Happy New Years guys. Thanks for keeping this thread running. I don’t mind wading through multiple pages at all to read the latest..

Manning & Napier was bought out by Callodine Group LLC in the middle of 2022. I'm only guessing, but possibly the acquistion didn't go well or sit well with Manning & Napier fund annalists and managers. Just a guess.
Manning & Napier was a great but very small boutique bond investment firm in Fairport NY, a very nice suburb of Rochester. It went public about 10 years ago, which may or may not corollate to the other turnover mentioned in your post.

The problem with Marks and many others is in the details.
How do you control risk in real life when markets punch you in the face?
If you know your goals, risk, volatility and are willing to tolerate it, and you are a buy-and-hold investor, you should have less of a problem. That's a lot easier for the accumolator.
In retirement, things get more difficult. When to retire? when to take SS? future taxes, pensions, LTC?. Are you really needing the future risk/SD? If you have enough?
I have been thinking, practicing, tweaking, and testing performance under risk/SD for about 25 years. This is what has worked for me.
1) The best way to avoid losses is to sell to MM. I couldn't find any fund(s) that can minimize the losses for the entire portfolio to under 3%, not even 5%, and still have reasonable performance as 50/50.
2) Investing based on what happened months ago or 1-2 (or more) years is a no-go. The worst years present great opportunities because of item 1 above.
3) There is almost nothing 100% safe. Stocks go down, bonds, even treasuries go down (2022). Not all MM are safe too; some can limit your access when you want to trade, others can break the $1.
4) Diversification doesn't save you either. IMO, investing in just 3-6 funds is all you need to make your life simpler.
5) Valuation and others are another trap.
The solution:
Do almost nothing
or
Know what you are doing, be a good trader, and know the risk/SD, it is different many times; expect the worst and hope for the best. Expect the worst is the key. A 5-10% decline can end in 20-30% and even 50%. If you wait too long, you are too late.
This is the main point: you can't define the risk/SD, it's not predictable.

You may have seen the news that the 39th President Jimmy Carter passed away after about 2 years under home hospice care.

U.S. stock exchanges will close on Thursday, January 9 in observation of a national day of mourning in honor of former U.S. President Jimmy Carter, who died on Sunday at the age of 100.
The New York Stock Exchange and the Nasdaq announced the closures on Monday, a customary gesture to honor deceased presidents.
The Securities Industry and Financial Markets Association has recommended an early close on Jan 9 for the U.S. bond market at 2:00 p.m. ET/1900 GMT.

https://www.reuters.com/world/us/wall-street-close-jan-9-honor-president-jimmy-carter-2024-12-30/

M* has what looks like an absolute risk scale (1-100) for funds. Unlike its category risk scale (low, below average, ..., high), funds are not measured against their peers.
The methodology talks about target allocation benchmarks, but from what I've seen these "portfolio risk scores" are not rescaled according to fund type. Equity funds are inherently more risky and thus always seem to rate mid to high scores. Ultrashort funds seem to always score in the single digits regardless of their risk relative to peers.
RPHIX - 4
CBLDX - 5
DHEAX - 6
This ordering comports with my understanding of their relative risks. The Dave Sherman funds are managed to have very little volatility.
CBLDX has a longer effective maturity (1.01 years) and higher volatility (1.57) than RPHIX (2.7 - 6.8 months and 0.80 respectively).
DHEAX has a higher standard deviation of 2.38, and an effective duration of 1.47 years. Even without considering that a fund's duration is shorter than its maturity, this is already longer (worse) than CBLDX's 1 year effective maturity. It had a worse drawdown in March 2020 and lost money in 2022 while the other funds have never had a losing calendar year.
Portfolio Visualizer confirms the relative rankings, Feb 2018-Nov 2024, the funds' std deviations are 0.92, 2.76, and 4.27 respectively, while max drawdowns are 1.09%, 5.50%, and 9.74% respectively.

Hospice Coverage
Hospice care is palliative (not curative) care for comfort & pain relief for terminal illnesses. The hospice care is under Medicare Part A, but the room & board aren't covered. The care can be at hospice facilities or at-home. Medicaid-eligible trusts (MAPT) may be used with advance planning.
You may have seen the news that the 39th President Jimmy Carter passed away after about 2 years under home hospice care.
https://ybbpersonalfinance.proboards.com/post/306/thread

Historical precedent imo does not hold much value.
Others beg to differ. They look at how a fund performed in specific economic environments (such as the 2008 GFC you mention) and/or over full economic cycles to get a sense of how the fund might behave going forward. These are not guarantees but data points that help gauge risk.
Prior to the 2008 GFC, real estate prices had NEVER gone down nationally and the "pundit" consensus at the time was it could not happen (real estate pricing is local blah blah...) and yet.
2008 demonstrated that diversification is not a cure-all. Geographic diversification did not prevent losses in the real estate sector. Actually, in 2008 even diversification across sectors would not have improved matters much.

Real estate investment trusts wrapped up 2008 with negative returns, including dividends, of 37.3% on average, according to a report released Wednesday by the National Association of Real Estate Investment Trusts in Washington. The performance was in line with the broader indexes, such as the Standard & Poor’s 500 stock index, which was down 37%, the Russell 2000 Index, which was off 33.8%, and the Nasdaq Composite Index, which declined 40.5%.

https://www.investmentnews.com/alternatives/reit-returns-fell-373-in-2008/19418
A minor point on your datum for completeness. Real estate prices did go down (Y/Y) prior to 2008. It's just a specific slice of real estate - housing transactions involving conforming Fannie May/Freddie Mac loans - that hadn't dropped before then. Case-Schiller's broader housing index dropped in previous years (1991, 2007), as did commercial real estate.
Assessing the Credit Risk of CDOs Backed by Structured Finance Securities: Rating Analysts’ Challenges and Solutions: fn 5 and Figure 1.
AAA CLO can incur a loss regardless of the prior 30Y history
Of course. And MMFs can break a buck - retail funds had a 37 year run, 1971-2008 before incurring a loss. But that didn't make their history useless.
The 30 year run of AAA CLOs without losses doesn't prove they never will lose money. Rather, it serves as evidence that these relatively complex structured vehicles are not brittle. They have not collapsed in a variety of stressful environments. Nevertheless, there may be a latent design defect that will show up when the exactly right conditions arise.
I wouldn't bet my last dollar on that never happening, just as I wouldn't bet my last dollar on MMFs never failing or being frozen. But that possibility doesn't deter me from using MMFs for some of my cash. It's a matter of what risks you perceive (it's never zero) and how sensitive you are to those risks.

Human beings need reminding the same thing every few years to protect them from themselves. By now, in the minds of many, GFC is just an acronym devoid of the depth of its true meaning.

All the more reason to understand the difference between CDOs which caused the 2007-2009 financial crisis and CLOs which did not.
If you were invested to a significant degree when the GFC began (late 2007) it’s pretty hard to forget. I recall a chance meeting on the street in early ‘08 with an aquantence from my high school years, then retired, who recounted the pain he and his wife were going through having lost about half their life savings in a matter of months, (Some “high-yielding” mutual fund as I recall.)

"I would trust AAA rated corporates over AAA rated securitized stuff."
Human beings need reminding the same thing every few years to protect them from themselves. By now, in the minds of many, GFC is just an acronym devoid of the depth of its true meaning.

There weren’t many investment grade CLOs available at retail prior to 2020 when JAAA opened. HSRT came up in a web search. It gained +3.77% in 2020. I would never recommend one as a cash substitute. I confess to having misread the original post as at least opening the door for something “more active” (aggressive) then the safety of cash. If you want safety, short-term T-Bills are usually regarded as the safest investment, with insured bank / credit union accounts a close second. How a chaotic government shutdown (budget related) might upset that assumption is sometimes a topic of conversation.
True, cash is what one desires for absolute safety, especially if it’s to fund near term commitments (housing, medical care, child support, etc.) As an investor I have sometimes “stretched” the definition of cash as a part of a diversified portfolio. ”Relatively safe” compared to most other investments I hold works for me. Willing to take a short term haircut in pursuit of longer term goals. Like OJ, I’m getting up there in years, so “long term” still exists but in a different way. My current risk perameters allow me to hold about 5% in JAAA alongside 5% in a money market fund. But that’s not for everyone.
As @Junkster says, CLOs are not substitutes for cash (as defined in the strictest sense). I’d submit that neither is the River Park fund often mentioned. And he is correct that CLOs took a brief clobbering in March 2020 and for a few months beyond. Even my quite respectable ultra-short fund (TRBUX) at the time got knocked down. Truth is corporate bonds of every stripe got hit hard for a short period until the Fed stepped in and took the unprecedented step of backing investment grade debt. A black-swan like the Covid affair can strike at any time. They’re all different and usually unexpected. As bad as the hit was for CLOs for a month or two, equities got hit much harder. My p/m mining fund fell out of bed overnight. I’d go back and check how much it lost in a day or two, but it would be too painful.

Regarding CLOs, what is conveniently not mentioned is like most everything else in Bondland they melted down too during the Covid meltdown. Investment grade CLOs from AAA to BBB had drawdowns from 10% to 30% while below investment grade drawdowns were 40% to 45%. As recently as 2022, while investment grade CLOs eked out a small gain (JAAA) of under 1% below investment grade lost money. The longest tenured bond fund primarily into CLOs ( an interval fund) lost money 4 years since its 2014 inception. In 2020 it had a multi week drawdown of 30%. As recently as 2022 this CLO fund lost 4.48%. 2023 and 2024 just happened to be “the right place right time” for CLOs. I hold slightly under 50% in CLOs but I am more than cognizant of the risks. A substitute for cash they certainly aren’t.

What is cash? If one is thinking "checking account" (instant liquidity w/o loss), then even CDs don't qualify.
On the other end of the spectrum there is cash as an investment - locking up cash in fixed rate investments for longer periods of time (typically years). You can still get at that cash for emergencies, but at a cost. However, the cost is much less than the risk of investing in the market, and the cost is often known in advance (e.g. CD early withdrawal penalty).
Representing the first perspective is this piece by M*: Why Ultrashort Bond Funds Aren’t Cash Substitutes. "[I]n 2008 ... the average ultrashort bond fund dropped 8.4%. ... [In 2020] [w]hile most investment-grade bond categories posted positive returns during the market’s flight to quality, the average ultrashort bond fund lost about 1.8% in the first quarter.
And the 2020 losses peak to trough (March 6 - March 23) were much greater.
These relatively extreme (for their category) losses occur when the economy experiences severe jolts (GFC, pandemic). For "checking account" type cash, even these short lived, though sharp, jolts are unacceptable. For longer term "investment cash", the short term disruptions may be acceptable.
A difference between ultrashort bond funds and IG CLOs is that the CLOs are more complicated investments. In theory, AAA tranches should hold up well in any environment other than one where everything gets hit. And they should recover better. There's some solace in JAAA doing just that in 2022. But that's only one stress test and there are many ways the economic system can get jolted.
Junkster mentioned CLOs doing poorly in 2020. Was their behavior distinctive or just in line with (though more severe than) the rest of the IG market? That is, can we glean anything about their special risks from 2020? If not, then all we can say is that, yes, bonds of all ilk can get hit by system shocks and recover similarly.
If that is unacceptable, only invest in guaranteed principal vehicles (Treasuries, CDs, credit union time deposits, bank accounts, etc.).