Ok, one more bond post. I thought I was done with this little series of bond TAA posts but based on some feedback and some very astute questions from my subscribers I decided I needed to do one more. So, here is the basic question I received, “Aren’t you concerned Read more…
This is my last post in the three part series on TAA bond portfolios before I get back to the equity side of things. Today I wanted to look at a way an investor can significantly increase returns in their bond strategies. The TAA strategy I’ll present below uses fixed Read more…
Note: an enhanced version of this strategy, BOND-COMP, is now part of the Economic Pulse Newsletter Most tactical asset allocation strategies focus on equites. That’s completely understandable. They are the highest return asset class over the long run and that is where most of the TAA research has been done. Read more…
Wow! I just realized this week that it has been four and half years since I first wrote about trend following for bonds. Time for an update I think. The inspiration and reminder that it had been a long time since I had written about TAA for Bonds was this Read more…
I was going to title this post something like ‘bond quant performance during the bond meltdown’ or something a bit more hyperbolic than the current title. But there’s enough hyperbole in the financial news without me adding to the mix. Just google ‘bond meltdown’ and you’ll see what I mean. Read more…
There is a severe lack of long term perspective by most financial market participants these days. Interest rates, and in particular the potential for a dramatic rise in future rates, is just the most recent example. Most analyses of rising rates don’t go back far enough to be really useful. Read more…
Contrary to the overwhelming consensus at the beginning of the year, bonds have done remarkably well year to date. With that in mind I wanted to update the SWRs for the 100% US TIPs retirement portfolio I presented last year. With rates down, SWRs will be down as well but Read more…
Its been almost 4 months (June 26 to be precise) since I last posted on municipal bond valuations. I thought this would be a good time to do a quick update on muni valuations. In short, there is still compelling value in municipal bonds for long term investors willing to Read more…
Is it possible to achieve higher safe withdrawal rates, compared to a stock/bond portfolio, from a 100% bond portfolio? With bond prices at historical highs? That’s what I wanted to find out. I started thinking in this direction after my look at bottoms up retirement planning and calculating what low Read more…
What happened to all the buy and hold bond investors? See table below. The latest long term fund data from ICI shows bond investors are doing what most investors do. Flee an investment at the first signs of distress. Taxable bonds lost about 4% of assets in June and Read more…
The recent “taper-tantrum” over the Fed’s potential coming removal of quantitative easing has caused quite some unrest in the bond market. This has caused interest rates, in particular longer term rates (10yrs +) to move substantially higher across the board. Long term munis were no exception and the sell off Read more…