NHMAX+ORNAX had a great run in 2019. LT bonds isn't a category I usually use because of higher volatility. My goal is to stay within lower volatility funds but still make a good return. HY Munis also have tax-advantaged over LT bond.
Lastly, if you read any reasonable book, article, advice about bonds, their recommendation is to stay with inter-term duration for a good reason.

Hmmm...yet you routinely post here and elsewhere that you make (sic) "guerrilla trades" of, you know, stocks. Aren't stocks more volatile than LT bonds?

Is the above has anything to do with the subject of this thread "Muni Bond party should continue in 2020' ?
Did I post anything about my trades in this thread?

Read, "Well, I guess you got me there."

NHMAX+ORNAX had a great run in 2019. LT bonds isn't a category I usually use because of higher volatility. My goal is to stay within lower volatility funds but still make a good return. HY Munis also have tax-advantaged over LT bond.
Lastly, if you read any reasonable book, article, advice about bonds, their recommendation is to stay with inter-term duration for a good reason.

Hmmm...yet you routinely post here and elsewhere that you make (sic) "guerrilla trades" of, you know, stocks. Aren't stocks more volatile than LT bonds?

Is the above has anything to do with the subject of this thread "Muni Bond party should continue in 2020' ?
Did I post anything about my trades in this thread?

NHMAX+ORNAX had a great run in 2019. LT bonds isn't a category I usually use because of higher volatility. My goal is to stay within lower volatility funds but still make a good return. HY Munis also have tax-advantaged over LT bond.
Lastly, if you read any reasonable book, article, advice about bonds, their recommendation is to stay with inter-term duration for a good reason.

Hmmm...yet you routinely post here and elsewhere that you make (sic) "guerrilla trades" of, you know, stocks. Aren't stocks more volatile than LT bonds?

My impression is that PIMCO generally uses derivatives to boost income as opposed to using them to mitigate risk. Likewise, it can be more aggressive with junk bonds.
Foreign exposure? PIMIX is weighted negative 30% in non-USD developed markets. It is also 14% long in emerging markets.
See excerpts below from the funds' prospectuses and fact sheets. They may be meaningful or may signify nothing. Reading these docs is like reading tea leaves. They can mean whatever you want to read into them. For your amusement to compare and contrast.
Objectives:
PIMIX: The Fund’s primary investment objective is to maximize current income.
Long-term capital appreciation is a secondary objective.
RPIEX: The fund seeks high current income.

Investment strategies:
PIMIX: The Fund seeks to achieve its investment objectives by investing under normal circumstances at least 65% of its total assets in a multi-sector portfolio of Fixed Income Instruments of varying maturities, which may be represented by forwards or derivatives...
RPIEX: The fund also uses [derivatives], primarily to manage interest rate exposure and limit the fund's overall volatility.
High yield (junk) bonds:
PIMIX: The Fund may invest up to 50% of its total assets in high yield securities rated below investment grade by [an NRSRO] or if unrated, as determined by PIMCO (except such 50% limitation shall not apply to the Fund’s investments in mortgage- and asset-backed securities). [Note that 77.6% of the fund is presently in securitized debt.]
RPIEX: The fund focuses mainly on holdings that are rated investment grade .... However, the fund may invest up to 30% in high yield bonds, also known as junk bonds, and other holdings (such as bank loans)
Fund home pages (with links to fact sheets, prospectuses, etc.)
PIMIX: https://www.pimco.com/en-us/investments/mutual-funds/income-fund/inst
RPIEX: https://www.troweprice.com/personal-investing/tools/fund-research/RPIEX

NHMAX+ORNAX had a great run in 2019. LT bonds isn't a category I usually use because of higher volatility. My goal is to stay within lower volatility funds but still make a good return. HY Munis also have tax-advantaged over LT bond.
Lastly, if you read any reasonable book, article, advice about bonds, their recommendation is to stay with inter-term duration for a good reason.

Mike, A lot of risk measures are related to the category, and it is sometimes difficult to compare between categories. The 4 funds above are more risky in the non-traditional bond oef category, approaching lower risk multisector bond oefs. For me personally, I use M* quite a bit to try to establish relative risk between funds, but there are imperfections and complexities. I usually start with how M* has established Risk, COSIX is rated as Average risk, and DFLEX, IISIX, and PFIUX are all rated by M* as having "Below Average" risk. I then look at Standard Deviation as another singular way at looking at volatility, which closely corSDponds to risk--so again COSIX has the highest SD at 2.45, followed by PFIUX at 1.56 SD, IISIX with a 1.52 SD, and DFLEX at 1.51 SD. I gave you information about the credit qualiity of assets in each bond in my post above, so you can look at how much Investment grade bonds are in each fund vs. junk rated bonds. I like to put all the funds on a performance graph and then look at their performance patterns, with particular emphasis on peak to trough drops in downmarkets. There are many other statistical measures of risk, including upside/downside capture ratios, Sharpe ratios, etc.
You have to remember that in the non-traditional bond oef category, the definition of this category notes the widespread use of more sophisticated investment techniques involving shorting, hedging, leveraging, and large host of measures that will vary from fund to fund, but they do impact performance. So, any simple way of determining risk is often not that simple--for the most part I depend heavily on SD, and M* risk categorization, but I look at a lot of other things to dig down deeper to form an opinion.
When you compare the 4 funds above, there are a number of other nontraditional bond oefs that I consider much less risky, including SEMMX which has a much lower SD. When you start looking at funds like ZEOIX, from the HY Bond category, it is even more tricky, but ZEOIX has a very low SD and its performance pattern, like SEMMX, is very smooth and upward, including almost no drops in performance in downmarkets. So, in my opinion, I would consider ZEOIX and SEMMX the least risky and very close in riskiness, and then a bigger step up to IISIX, followed by DFLEX, then PFIUX, and COSIX being the most risky. Some may argue with me on these rankings, if they stress some other characteristics more than those I emphasize.
I will eventually make another post about non-traditional bond oefs, that are as a group lower in risk, and close to the short term bond category as a cash alternative.

Boost Your Retirement Income With Tricks The Pros Use
https://www.investors.com/etfs-and-funds/retirement/retirement-income-strategy-pros-use/
Finding retirement income is still a challenge. Interest rates remain low. But you can borrow a key trick financial advisors use to solve this puzzle.
For every $100,000 you invest in this group of funds, you could have created. Bond Fund (PEBIX) for a 4.5% yield plus gains from the bond prices."

@hank: I'm sorry to hear of you're problem, so to speak. Did you stand pat or move on ? You've caught my ear & I would like to hear more .
Have a good week, Derf

Thanks Derf! (I wasn’t asking for sympathy.) :) Oppenheimer never had more than 10% of my assets. What they offered were some niche funds others didn’t. Some were gems / other clunkers. But when you’re with a house for a quarter century you accumulate a deep understanding of their offerings and operation that’s difficult to replicate elsewhere. So I miss their operation, even though it wasn’t the sharpest gang on the block in all respects.
As far as “voting with one’s feet” - that’s all too easy to do in this day and age - often with just a few key strokes. And my fuse is as short (or shorter) than the next guy’s. To answer your question, I’m in the process of moving about one-third of my already small holdings at OPP/ Invesco to T. Rowe. What remains is mostly split between their miners’ fund (which has benefitted from gold’s uptick) and some cash. Also have a tad in an alternative fund there.
The issue of fund house closings / mergers might have significance to the broader mutual fund community. My own issues were mentioned merely to represent what that circumstance might entail and how it might affect others. If you were dumb enough to pay a front load for those A shares 25 years ago (I was), than perhaps the “sting” is felt a bit sharper.

I agree withe the basic premise of the article but then maybe because I'm a dividend growth investor I tend to be biased. According to Ned Davis Research, from 1972 to 2018 dividend growth stocks outperformed the broader market by 2.3% CAGR and with 12% less volatility. If one invests in a company with sufficiently stable cash flows to generate a long dividend growth streak (e.g. Dividend Aristocrat) they are less likely to bail during times of increased market fear. I am in it for the income and patient enough to buy these stocks when they get trashed for no discernible reason. While no dividend stock is a true bond alternative, quality dividend growth stocks (like the famous aristocrats) tend to have much lower volatility over time. Volatility, dividend growth, quality, and value are four proven alpha factors that have beaten the market over the long term.
I was intrigued enough to seek out the Goldman Sachs basket and found this article below. Apologies if it's been linked before.
Goldman Basket Possibilities
Edit: and I suppose I should back up that Ned Davis statement with a reference.
Long Term Performance of Dividend Paying Stocks

This post is about Non-traditional Bond oefs, that resemble and perform in a manner, similar to multisector bond oefs.
"Morningstar Category: Nontraditional Bond
The Nontraditional Bond category contains funds that pursue strategies divergent in one or more ways from conventional practice in the broader bond-fund universe. Many funds in this group describe themselves as "absolute return" portfolios, which seek to avoid losses and produce returns uncorrelated with the overall bond market; they employ a variety of methods to achieve those aims. Another large subset are self-described "unconstrained" portfolios that have more flexibility to invest tactically across a wide swath of individual sectors, including high-yield and foreign debt, and typically with very large allocations. Funds in the latter group typically have broad freedom to manage interest-rate sensitivity, but attempt to tactically manage those exposures in order to minimize volatility. The category is also home to a subset of portfolios that attempt to minimize volatility by maintaining short or ultra-short duration portfolios, but explicitly court significant credit and foreign bond market risk in order to generate high returns. Funds within this category often will use credit default swaps and other fixed income derivatives to a significant level within their portfolios."
Attached are 4 Non-traditional bond oefs, that I believe are potential funds you might consider, as a Conservative Bond Oef investor, as lower risk alternatives to Multisector Bond oefs:
1. COSIX: One of the more risky Non-traditional Bond oefs with a SD of 2.45. Its assets are spread across 4 asset groups--Gov't (18.26%), Corp (28.55%), Securitized (28.39%), Cash (23.79%). Its Assets fall into the following investment grades--AAA (12.22%), AA(7.54%), A(8.89%), BBB(24.4%), BB(13.82%), Below B/NR(19.83%)
2. IISIX: One of the better total return options with a SD of 1.52. Its assets are--Govt(12.68%), Corp(20.58%), Securitized(53.14%), cash(13.62%). Its assets between investment grades are--AAA(21%), AA(5.16%), A(5.16%), BBB(21.5%), BB(16.85%), B(19.95%), Below B/NR(4.96%)
3. DFLEX is managed by the well known Gundlach with a SD of 1.51. Its assets are--Govt(14.71%), Corp(26.8%), Securitized(51.6%), cash(6.89%). Its assets between investment grades are--AAA(17.43), AA(3.6%), A(5.87%), BBB(21.01%), Below B/NR(26.5%)
4. PFIUX is from PIMCO with all of its stable of analysts with a SD of 1.56. Its assets are---Govt(24.89%), Corp(11%), Securitized(30.5%), cash(22.8%), other(10.28%). Its assets between investment grades are---AAA(79%), AA(6%), A(9%), BB(3%), Below B(3%)

The spousal Roth IRA has been discussed here previous; but I'll add this again, as many remain unaware of this provision.
From personal experience, I've helped 12 married couples discover this little known provision. Obviously, a married couple needs to have the financial resources to fund a spousal Roth IRA; but even a few hundred dollars annually makes a difference going forward. The common circumstances I encountered were: one spouse retires several years earlier than the other, or one spouse has a temporary or permanent job loss.
"Generally, you need earned income to contribute to a Roth IRA. For married couples, there is an exception. You can contribute to an IRA for a non-working spouse, up to the maximum annual limit. A spousal Roth IRA isn't a joint account, but can be an effective way for couples to double their retirement savings."
Aside from the IRS link below, do a broad search for spousal Roth IRA to discover more details.
IRS pub. here .....read Spousal IRA section
As always, remain curious,
Catch

To continue the fund description that Lipper quoted from T. Rowe Price:
The fund also uses interest rate futures, interest rate and credit default swaps, and forward currency exchange contracts, primarily to manage interest rate exposure and limit the fund's overall volatility.

Thanks for sharing the TRP fund's investment strategy. It resembles what Pimco fund such as PIMIX does, except it is more of a domestic multi-sector fund. RPIEX has additional coverage of oversea debts. Other than a slight underperformance in 2019, PIMIX has done very well over the same time period comparing to RPIEX.

https://www.morningstar.com/articles/961372/a-look-back-at-mutual-funds-in-2019
From Bogle and Ellenbogen to flows and acquisitions, it was a year of changes.
As 2019 winds down, most mutual fund investors can look back on what has been a pretty good year for the markets. Joining me to provide a recap of the top headlines in the mutual fund world is Russ Kinnel. He is Morningstar's director of manager research.

HY Munis continue to defy gravity and NHMAX+ORNAX already are up 1+% in just 10 days :-)

Well, if 1% in 10 days is (sic) "defying gravity"...
Meanwhile, LT bonds, the category that significantly outperformed all other bonds cats in 2019, the one you don't seem to cover/care about/know about, are up twice that, putting them into what you might regard as some kind of celestial orbit (I guess).

@hank I also remember doing a 15-year catch-up provision with my 403 b provider based on the following information and Link

To qualify for the 15-years of service catch-up (if the employer’s plan includes this provision) the employee must have 15 years of service with the same eligible 403(b) employer. The limit on elective deferrals to the participant’s 403(b) account may be increased by up to $3,000 in any taxable year (lifetime employer-by-employer limit of $15,000) if the employee has at least 15 years of service with the same employer in a:
public school system,hospital,home health service agency,health and welfare service agency,church, orconvention or association of churches.

https://irs.gov/retirement-plans/403b-plan-fix-it-guide-an-employee-making-a-15-years-of-service-catch-up-contribution-doesnt-have-the-required-15-years-of-full-time-service-with-the-same-employer

Thank you all for participating in yesterday's webinar.
Here is link to chart deck.
Here is link to video recording.
c
-----------------------------------------

This coming Wednesday, January 15th, we will host a webinar discussing latest features of the MFO Premium search tool site. Topics covered will include the new home page and user portal, the MultiSearch Portfolios tool, updated metrics for risk adverse investors, expense rating, expanded category averages, revised “Include Averages and Benchmarks” options, and finally allocation indices across ten decades.

There will be two sessions, one at 11 am Pacific time (2pm Eastern) and one at 2pm Pacific time (5pm Eastern). The webinar will be enabled by Zoom. Please use the following links to register for the morning session or afternoon session. Each will last nominally 1 hour, including questions.

Here are links to previous webinar charts and video recording.

Hope to you can join us again on the call. If you have any questions, happy to answer promptly via email ([email protected]) or scheduled call.

Many nearing retirement seem unaware of the IRS “Catch-up“ provisions. Appears current law allows persons over 50 who were unable to fully fund their retirement plan in prior years to make generous catch-up contributions later on in addition to the current yearly limit. I’m unclear whether it pertains to IRAs, but it appears that at least in some cases it does. My experience more than 2 decades ago (with a 403-B) may no longer be representative. But in my case the “catch-up“ came in darned handy in shoring-up earlier insufficient contributions as retirement neared.
Quick search pulled up 3 reads:
https://www.investopedia.com/terms/c/catchupcontribution.asp - Invesropedia / general description
https://www.irs.gov/retirement-plans/401k-plan-catch-up-contribution-eligibility - IRS / 401K
https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-catch-up-contributions - IRS / mentions IRAs - but I’m unsure of types and amounts.
PS - I should have read John’s article first: “ The maximum amount you can contribute to a traditional IRA for 2020 is $6,000 if you're younger than age 50. Workers age 50 and older can add an extra $1,000 per year as a "catch-up" contribution, bringing the maximum IRA contribution to $7,000. You must have earnings from work to contribute to an IRA, and you can't put more into the account than you earned.”
Perhaps my added emphasis may be helpful to some. :)
From Simon - “Inflation (Consumer Price Index) was up 2.1% in 2019 as of last November” -
While that sounds trite in the face last year’s near 30% return on the S&P, it really depends on perspective. A 2% rise in cost of living (if you believe the numbers) would look quite different following a 30% decline in equities, especially if bonds languished or fell in value. And even at 2% a year, over 5 years you’re looking at well over a 10% increase in COL. (Remember that inflation compounds in a manner similar to how interest does.)

As I have previously posted, Muni bonds have a strong seasonality factor that has been written about. January is one of the stronger periods of performance historically:
The Four Seasons of Muni Bond Investing
FEBRUARY 14, 2019 BY SAGE ADVISORY
Timing is everything. For a municipal bond investor, annual seasonal trends can provide great entry and exit points, if executed properly. There are four distinct seasonal periods that occur annually due to structural factors inherent in the municipal bond market. If timed correctly, municipal investors can increase their probability of successfully trading these markets and reap the reward of better returns.
The four seasonal periods that affect the municipal market on an annual basis are January Reinvestment, Tax Season, June/July Redemptions, and the Holiday Season Slowdown.
January Reinvestment
Although not the heaviest period of bond maturity and coupon payments, January 1st does experience an elevated level of cash that needs to be reinvested. In addition, the lingering effects of the Holiday Season Slowdown contribute to a limited amount of new issue supply, as well as diminished levels of secondary supply offered by broker/dealers. This strong technical environment tends to last anywhere from a few weeks to well into February, depending on the direction and magnitude of market flows. For investors who can time liquidity needs, January represents one of the most advantageous times of year to raise funds.
Tax Season – late March through April
From late March until the end of April, the municipal bond market tends to see both a reduction in demand as well as a heightened level of selling to fund tax payments. (Selling tax-exempt municipal bonds to fund personal federal and state tax liabilities remains one of life’s great mysteries.) Regardless, tax season provides an attractive entry point for investors, as limited demand and improving new issue supply tend to push valuations to more attractive levels.
June/July Redemptions
The heaviest period of maturing bonds and coupon payments is during these two months and represents anywhere from 40% to 60% of annual redemptions. Typically, municipal issuers come to market during this time, which offsets the demand pressure from reinvestment. Unfortunately, over the past several years, municipalities have been paying down debt and reducing debt issuance, which has created a net negative supply environment. As long as new issuance remains below the long-term averages, municipal bonds will remain supportive during June and July and provide investors an opportune time to rebalance portfolios (such as reducing credit risk).
Holiday Season – late November through year-end
Thanksgiving should indicate a warning sign to investors regarding optimal liquidity and ample supply. During the week of Thanksgiving, the markets may be open; however, the focus of the market is limited. The last week of November and the first two weeks of December represent the final opportunity for investors to efficiently trade before the market essentially shuts down for the year. Junior traders and reduced staff remain the norm during the last two weeks of the year. Market making and risk taking are severely restricted and a noticeable liquidity premium on bonds is apparent. Fortunately, for those investors looking to put cash to work, the ability to purchase bonds from forced market sells offers the opportunity to add exposure at discounted levels.

JpM, according to M* CFRIX and EIFAX are rated as having the highest risk in their categories, with some of the highest SDs. SPFLX is rated by M* as having below average risk and below average return, but the assets that SPFLX holds, pays well over 6% yield, which frequently suggests some of the junkier holdings you can own to get that level of yield. SPFLX had a relatively poor 2019 performance--not sure why but I would guess it is because of some poor choices in very junky holdings. I did not mention any of those BL funds for a "conservative" investor, but they may be very good choices for more of a trader, or an investor who is willing to tolerate very high volatility. EIFAX is a very popular BL choice with great returns, so for more risk oriented investors or good traders, who can tolerate higher volatility, it may be a great choice.

A couple more factoids:
- M* rates it bronze; though I have my doubts about how much intelligence there is in M*'s artificial "intelligence" ratings (done by machine, not analyst)
- Its 165% turnover rate is not a mere artifact of being a bond fund. 90%+ of the cap gains it has distributed in the past four years are short term. On the other hand, it distributed no cap gains in two of those four years (losing years, perhaps?)
The fund did well out of the gate, for its first two years, but has been essentially flat over the past three. My guess is that the star rating will nevertheless go up in a couple of weeks when the fund hits the five year mark. The way M* calculates stars is to compute a weighted average of a fund's three year rating, its five year rating (if available), and its ten year rating (if available). The two good years of the fund aren't getting counted because the fund is just short of five years. In a couple of weeks that will change, and those good years will be included.
To continue the fund description that Lipper quoted from T. Rowe Price:
The fund also uses interest rate futures, interest rate and credit default swaps, and forward currency exchange contracts, primarily to manage interest rate exposure and limit the fund's overall volatility.
If I'm going to buy a nontraditional fund that uses these techniques to manage interest rate risk and volatility, I'll buy one that does it well: FPNIX. It doesn't seek high current income, just the opposite (though it still sports a very similar SEC yield of 2.59% vs. 2.69% for RPIEX). Slow and steady wins the race.
Here's a chart comparing their performance over the lifetime of RPIEX.