QUESTION OF THE DAY 20210411
Why do people invest in Bonds and Bond Funds ?
It seems to be a very strange thing to do
And yet a lot of money goes into them
1. Traditional Bond Mutual Funds
Cash In : $4.3 trillion
Net Assets = $5.1 trillion
Capital Gains = +$0.7 trillion
Why do people invest in Bonds and Bond Funds ?
It seems to be a very strange thing to do
And yet a lot of money goes into them
1. Traditional Bond Mutual Funds
Cash In : $4.3 trillion
Net Assets = $5.1 trillion
Capital Gains = +$0.7 trillion
Now let's take a closer look :
Capital Gains have essentially been unchanged since 2010
So the holders may have made enough on their interest income to offset inflation during the last decade
- like a couple of percentage points if they were lucky
Capital Gains have essentially been unchanged since 2010
So the holders may have made enough on their interest income to offset inflation during the last decade
- like a couple of percentage points if they were lucky
But they have really made no money
And why should they have done ?
And yet they seem to like storing more and more Cash in these funds
- presumably helping fund this issuance of Government paper
Daft really
And why should they have done ?
And yet they seem to like storing more and more Cash in these funds
- presumably helping fund this issuance of Government paper
Daft really
ETF BOND INDEX FUNDS
A relatively new structure
Cash In : $827.0 billion
Net Assets = $852.2 billion
Capital Gains = +$25.2 billion
- basically a waste of time
- nobody has made any money
A relatively new structure
Cash In : $827.0 billion
Net Assets = $852.2 billion
Capital Gains = +$25.2 billion
- basically a waste of time
- nobody has made any money
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