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Treasury bond ladder?
Romey
06-09-2008, 7:47 PM | Post #2526671
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I have quite a bit tied up in bond funds for diversification purposes--with a long time horizon. I own DODIX and FTABX, as well as a Vanguard Muni fund and a TIPS fund. And some I bonds. I must admit I tire of seeing my DODIX and FTABX just sit still over the years--NAV goes up, yield goes down, and vice versa. Literally they are just about where they were several years ago. I'm not interested in joining any debate about whether higher yield in bond funds makes up for decreased NAV, etc etc.
I am interested in knowing more about bond laddering with Treasuries--I just don't feel comfortable in buying corporate bonds.
I hear a 5 year ladder is generally the best option. Since T Notes are only issued in 2, 5 and 10 year maturities, and I can get a one year T Bill, how would one set up a ladder with these issues? Get one year, 2 year, and 5 year the first year, then add a second set of 2 year Notes again the second year and third year? How would one set it up so once yearly one would have Treasuries maturing, with a 5 year ladder?? Thanks!!
Topics
corporate bonds
horizon
I-bonds
Muni
NAV
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