All fixed income has risks, whether it’s due to interest rate changes, reinvestment, inflation, default, or early withdrawal penalties. And then there are different levels of effort involved in different types of fixed income. Investors have to choose what’s more important to them.Bond funds are risky, as myself and others have discovered recently. I reviewed the Wiki perspective on bonds to see where it led me astray. Here is a quote from the Wiki: "You want your risks on the equity side, not the bond side." This is actually good advice and one I follow currently. Unfortunately the article recommends bond funds, which are risky. "You should generally own bond funds instead of individual bonds, for convenience and diversification." I'd suggest the Wiki section on bonds be rewritten to emphasize the risk aspect of bond funds.
Frankly, if you are frightened of the risks of Total Bond, you probably shouldn’t be invested in stocks either.
Statistics: Posted by rkhusky — Tue Dec 10, 2024 7:01 am