OP, may I ask why do you want to have a short term TIPS ladder? Do you have a need in the near future?
The nice thing about TIPS ladder is that you know what you'll get when each rung mature. Since TIPS fund never matures, the price fluctuates. Depending on the interest rate at the time you need the money, the fund value may drop.
I am having a hard time to understand how TIPS fund protects me from unexpected inflation. Like what happened in 2022, high inflation, high interest rate, TIPS fund/ETF price dropped. Let say you purchased 5 years individual TIPS in 2017, because you have a need in 2022. You'll get your investment protected against unexpected inflation, but if you purchase a TIPS ETF, you will have to sell and lost money.
I think if you need the money, ladder is better. Otherwise, TIPS fund is fine to diversify your fix income portion in your portfolio.
Have you looked at defined maturity TIPS ETF? https://www.etf.com/sections/features/c ... hich,%20as
I started building TIPS ladder for retirement. I want the certainty that I will get $X amount on that year to cover my expenses.
The nice thing about TIPS ladder is that you know what you'll get when each rung mature. Since TIPS fund never matures, the price fluctuates. Depending on the interest rate at the time you need the money, the fund value may drop.
I am having a hard time to understand how TIPS fund protects me from unexpected inflation. Like what happened in 2022, high inflation, high interest rate, TIPS fund/ETF price dropped. Let say you purchased 5 years individual TIPS in 2017, because you have a need in 2022. You'll get your investment protected against unexpected inflation, but if you purchase a TIPS ETF, you will have to sell and lost money.
I think if you need the money, ladder is better. Otherwise, TIPS fund is fine to diversify your fix income portion in your portfolio.
Have you looked at defined maturity TIPS ETF? https://www.etf.com/sections/features/c ... hich,%20as
I started building TIPS ladder for retirement. I want the certainty that I will get $X amount on that year to cover my expenses.
Statistics: Posted by RandomPointer — Sun Oct 06, 2024 9:29 pm