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There is a related article on leveraged loans in the Wall Street Journal "The Market-Beating Investment That’s Defying Wall Street Skeptics. Rising interest rates are boosting risky corporate-loan returns instead of hurting them"
If I understand correctly, the latest 1 month Treasuries yield is about 5.4%. I wonder whether it makes sense to buy them and then reinvest them automatically as Fidelity offers. One can invest like that each week. This would be almost as liquid as …
@Finder. Based on your research wouldn’t a Treasury only MM fund be at risk in a default? Perhaps greater risk than a Prime MM fund. And even the bond ETF AGG has 43% government securities. How would those be valued? Concerned? Nervous? Freaking o…
There is an article in Forbes about Money Market funds and default, https://www.forbes.com/advisor/investing/debt-ceiling-impact-money-market-funds/
It says that In 2008 there was a problem with one such fund, the Reserve Primary Fund, it was unable…
During the last 6 months, RPHIX gained $2.84%. If it continues, this will be 5.7% per year with minimal risk. If not a secret, can you tell us about better opportunities that you see now? Or do you have in mind what may happen with other funds when…
Just to point out some loophole: If you have more than 250K in any set of Artisan funds, you can buy any closed Artisan fund. From their prospectus about the required condition: "You are a shareholder with combined balances of $250,000 in any of th…
IRS: Interest income from Treasury bills, notes and bonds - This interest is subject to federal income tax, but is exempt from all state and local income taxes.
I believe that the final result depends on many factors, such as your tax rate now compared to the tax rate many years later. Yet another consideration is whether you plan to use all of your funds, or pass them to your children upon your death.
I made several similar orders lately. But I have a slight concern with respect to Treasuries vs cash. Fidelity money market fund FZDXX yields 2.23% now. When fed rises rates, it follows accordingly, with a short delay, so perhaps in a week or two it…
Just an FYI - on the question of commissions, most brokerages appear to charge a commission (e.g., 0.01%) in buying and selling Agency bonds. Today, Agency short term bonds were yielding nearly 50 pbs higher than Treasuries of the same maturities. …
To evaluate HMEZX it may be useful to look at other funds managed by Dondero, such as HHCZX, HSZAX. I looked, and I did not like them. It does not necessarily mean that HMZEX is bad, but it just made me less interested in this fund.
I was interested in HMEZX, but then I was concerned by the unimpressive performance of other funds managed by the same manager (Dondero), and by general comments that can be found here: https://www.institutionalinvestor.com/article/b1l0wrph2lc0j6/No…
Thank you very much for your suggestions, I will call the broker, at least the first time I will do it. But all the bid-ask issues seem to modify the profits at a fraction of a percent, not much, as compared with 9% per year. Perhaps I am missing so…
Yogi,
I wonder whether there is any real advantage in buying TIPS on auction as compared to secondary market? On auction, the shortest period is 5 years. There is a chance that in one or two years inflation will be much lower, and then the advantag…
I wonder whether the problems discussed above are related to the personal decision not to buy TIPS or T-bonds and hold them until maturity? I am considering buying T-bills. I never did it, so maybe I am confused by something, but I see that 52 week …
Sorry for a naive question. I never bought Treasury bonds, and I missed this auction. Does it make sense to buy the same TIPS now at Fidelity without auction, or their price will be significantly higher?
Interesting! I decided to learn more about gifting I-bonds and found this rather detailed discussion: https://thefinancebuff.com/buy-i-bonds-as-gift.html
Sorry, after I posted, I found that yogibearbull already gave this link in another discussi…
@davfor, I also watch HMEZX, looks really interesting, but I am confused by mixed record of its manager James D. Dondero, e.g. at HSZAX, HHCZX, etc., see also https://www.institutionalinvestor.com/article/b1l0wrph2lc0j6/Nothing-Can-Stop-This-Hedge-…
OAKMX and OAKLX did not beat SPY during the last 10 years, but since inception of OAKLX in 1996, it is up 1780%, whereas SPY is 936% up, and VTV (Vanguard Value) is 761%. Thus OAKLX significantly outperformed both S&P 500 and Value index since i…
Of course one can make money in some bonds, but is it a good idea to put 80% of the portfolio to treasuries when the interest rates may go up? Historical data since 1980 show falling rates, from about 15% in the past to about 1% now. The situation …
Concerning AKREX less financials and more tech, this statement was taken from M* analysis of November 2020. Unlike many computer generated summaries, this was a real analysis of changes there. I invest in this fund for many years, and I am very happ…
Founding manager of AKREX Chuck Are steped down at the end of 2020. He is 78. The team was preparing for that for a long time, so hopefully they will be just fine. But the focus of the fund was changing lately, less financials, more technology. Time…
I believe that all the funds listed above have strong/aggressive growth orientation. Growth was beating value for many years. If the trend changes (because of reopening), value may beat growth for many years. If you have money in growth AND value, t…
More about stock light portfolio: I wonder whether solid historic performance of this portfolio is related to gradually decreasing rates.? 40 years ago, in 1981, US treasury yield at its peak was 15.8%. Now it is below 2%. The difference is 14%, whi…
After many attempts, I received an answer from AlphaCentric about dividends vs return of capital in IOFIX. It is rather unusual, so I will put it here:
The 19A document is not a tax reporting document. It is an SEC reporting requirement. It has…
I invested in IOFIX in April 2020 in my taxable accounts. I have no immediate plans to sell it. There is a difference between paying taxes for ordinary dividends now, or for long term capital gains in the future, e.g. any time after April 2021, in m…
Please pay attention to the accuracy of their reporting in this notice (which covered only December 2020). They write:
"The Fund will send you a Form 1099-DIV in early 2022 for the 2021 calendar year that will tell you how to report these distribu…
I just called to Fidelity, they discussed it with tax people without connecting me to them, and the reply was that I should wait for the final version of 1099 and if there is any issue I should contact IOFIX directly. So I will wait.
I have 19(a) …
Thank you very much for responding. I believe that as of now, prior to sending us 1099 form, Fidelity considered all their distributions as dividends (as listed in my yearly report), and I know that they did not subtract ROC from my basis in IO…
MSSGX is a spectacular fund, I own it as a small part of my portfolio. But I continue trying to understand the source of its incredible outperformance. I was watching performance of the companies at its top five positions according to its latest rep…
