BOXX
Alpha Architect 1-3 Month Box ETF
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BOXX - Fixed Income Emulator - No Withholding Taxes?
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You’re asking two questions: 1. How much should I keep for an emergency fund (obviously an absolute number that’s realtive to your expenses). 2. How much should I keep on the sidelines in case of a crash to ‘buy the dip’. For #1, I keep 12mo of expenses in BOXX because my HHI comes from very unstable revenue streams and I’m in high brackets. For #2, that entirely depends on your philosphy and, critically, your time horizon. If long-term, I think most would argue that you should always be invested (no cash) unless you have a very strong driving thesis that you could defend (eg. Buffet and BH’s current cash hoard). *How* you distribute those investments might be the more interesting question: Portion in cash-like entities (eg bonds)? Highly diversified portfolio so you can harvest winners and buy-the-dip in losers? Or just be a Boglehead and always be invested in the total market. I don’t really know the answer, so curious to see what others think. Personally, I’m just a VT and chill kind of guy.
Mathematically, you are right on the efficient frontier. With a 10+ year horizon, the paper confirms that adding bonds (duration risk) for 'safety' is actually inefficient compared to pure equity exposure. Smart move using BOXX for the emergency tranche, getting the T-Bill yield without the ordinary income tax drag is a sophisticated optimization. You are essentially running the 'Academic Ideal' portfolio If you are interested, I wrote a full breakdown of this paper, including the "Pathological Preference" math, in this week's Research Note: [Read here (100% free and no paywall](https://t.co/z2Pur8pkcV))
I am ten++ years from retirement And my portfolio is nearly 100% stocks and ETFs. (I do hold some treasuries and BOXX as my emergency fund)
Retards ofc. Why do you think we're here? Also puts weren't full naked. Cash covered with liquidity in BOXX, SHY. and other bond etfs.
BOXX was 0.35% the last 30 days. $160,000 x 0.0035 = $560.00/mo $171,000 x 0.0035 = $598.50/mo
Drop it in BOXX or SGOV and that's an easy $500 a month just collecting interest. Use the $500 a month to play with options and keep that money safe. It's too easy to lose a lot more playing around the way you did (all in), this will help lock your profit and build wealth now. If you drop $160k for interest and keep $11.8k to play with, you will still earn at least $450 a month. Congrats on the win, now protect that money properly!
2nd home purchase... I had a PAL with Schwab a while back, but interest rates in general where much lower then. I am familar with BOXX spreads, not so sure I'd want to take a position large enough to fund a $1M credit.
I wouldn’t even bother with treasury bonds. There are plenty of ETFs that are basket of short or medium duration bonds that pay you monthly dividends without the hassle. SHY, SGOV, BOXX(1-3 month but reinvests the dividends back into the fund), WEEK are all good options
Maybe get the money into BOXX until you decide what to do with it longer term. (BOXX is an ETF that sells box spreads and goes up a penny or two everyday but it never goes down.) It pays about the same as a CD and equal or more than most bonds. But it's easier cause it is in your webull account don't have to move the money around.
If you buy BOXX Its $115 per share. $20k would get you 173 shares. It never goes down and it goes up between 1 to 3 cents every day. So most days you would make $1.73 to $4.00 Average it out to $2 per day. That's about $10 per week. 7 months is 30 weeks. So buying BOXX you would make about $300 with very very low.....almost zero risk.
Robinhood is 3.75% and BOXX as of January 2026 is 4.39% l, plus if held for a year or longer, qualifies for long term capital gains if you ever wanted to do that.
Can you tell me how they both are different and why you prefer BOXX?
BOXX is a god send, perfectly complement my portfolio.
I love keeping my cash is BOXX. SGOV overrated
Alternatively: BOXX if it's more important to control *when* you need to withdraw the cash, instead of the rate itself. For me, LTCG for Fed + State isn't that different than ordinary for Fed alone. If this is money I don't want to invest and won't need for at least a year or longer (eg. eFund), then BOXX is an easy winner.
I know this is r/options, but ... how about buying BOXX etf?
>What would you say is the benefit of a covered call ETF then? The benefit is great if you are 65 and retired and need income every month. If you have spent 35 years building up a great portfolio of $1million (or whatever number applies to your situation) and you can coast and enjoy retirement and not check the stock market every day. Its a fine choice. But if you are 35 and investing $2000 a month - you need growth. (Not some silly income ETf designed for old people) Too many people see something good and think it's good for them - but sometimes what's good for others, might not be good for me. A very big part of investing is about realizing where you are in your journey, and does this process or this product or even this allocation fit your need ? I'm older than you but still 10-15 years from retirement (maybe more or less if my stock picks go well or poorly) (Im a baseball guy - love baseball so i modeled my portfolio around baseball how their organizations are setup if you see that below) I have several different "teams" - all with different purposes. 1 taxable brokerage - it holds my emergency fund (SPAXX and BOXX and SGOV) this helps with expenses and if I need to upgrade my home field I am ready. and it hold ETFs.(Not exactly part of my emergency fund but in that account - I only buy and hold ETFs. Mostly VOO + VTI + some international funds - but i Never sell.) That's growing money that i could access if I need it. But I don't plan to use it until later.... when I really, really need it.(Hopefully retirement when my income is a lot lower so tax burden will be less) 2 Roth IRA - its all individual stocks growth focused (i buy and swing trade in this account holding anywhere from 3 days to a year if the stock does well) + I call this the major league roster. Its my big holdings. I have 9 starters (biggest positions) all of those have stop losses set to lock in profits cause they already proved to be big winners. I also have a bunch of reserves(the bench) who are growing into positions to become a starter if one of those main 9 ever drops more than my rules allow. 3 Traditional IRA - a mix of some ETF & some individual stocks. ( I jokingly call it my minor leagues) - any stock on my watch list - i sell a share of an ETF and buy some shares of some watch list stocks. But in this account I keep a few shares of anything I think might eventually become a major league starter someday. 4 Rollover IRA from an old employer (its all ETFs - but its 25 different ETFs mostly momentum and sector ETFs i rebalance every week takes 10-15 minutes and it beat sp500 by 10% last year) - I keep track of all this shit in an excel document that automatically downloads the prices and price history as soon as I open the file. I am sure it sounds super complicated but I have major ADHD and I love it. Keeps me busy when my wife goes to bed early I can study all this shit for an hour or two and keep my mind going
BOXX.... DOES SPREADS AND IT ONLY GOES UP EVERYDAY IEFA international developed countries fund
If you want at or near treasuries level - i like BOXX (an ETF that sells box spreads) and reinvests everything so there's nearly no dividends paid out. (Less tax implications) I also like XDIV (sp500 ETF that does not pay out any dividends) I hold those as a percentage of my emergency fund / other savings.
The main purpose of a box spread is to create a synthetic loan or bond. Investopedia has a good article on it. [https://www.investopedia.com/terms/b/boxspread.asp](https://www.investopedia.com/terms/b/boxspread.asp) I have some of my "liquid" or "cash" invested in BOXX. So far, it's working out great. BOXX goes up in value rather than disburse interest from bonds such as SGOV or VBIL. I am patiently waiting for the fallout from any tax issues.
I don’t know what the apy is for ally high yield savings but personally I put cash in BOXX or USFR the yield is around 5%. If you’re looking for more return and a bit more risk VOO, VXUS, QQQM, SPYM are all popular. These are a low cost index funds that track the overall market. (S&P500, International, and the Nasdaq100)
for me - i have a momentum trading account where when i decide to buy a position i just buy enough shares that its about 3% of my portfolio. then if i was right and it starts to increase in value i buy a bit more (maybe 1% each day) over the course of the next few days but i stop when i get to 6% of my portfolio then i stop buying and set stop limits (up and down) so for me a full poisition is 6% and then i watch it. and update my stop limits every day or every few days. as long as it keeps rising.....i might hold for a bit but if it loses momentum - then i sell it and start looking for the next one to jump on. (i might hold as much as 10-12 positions at any time and rotate the rest of my money in that portfolio between VTI QQQ VOO and BOXX in vraious weighting as needed)
Bonds bad gold better look at a 60/40 stock bond portfolio. It’s not a good look. My view is diversification is good if the instruments are not very correlated and both perform well. Just quick glancing at charts VXUS looks good and gives diversification into international stocks. VOO VXUS Gold I think would a be pretty solid long term portfolio. Cash in USFR or BOXX. NFA
if your real emergency fund is $50k - you could invest lets say $20-25k of it split sveral ways to diversify so if shut hits the fan and you have to sell not every thing goes down at once. say for example - if you dont need the dividends $15-20k in BOXX (box spread ETF that pays better than most treasuries and does not pay dividends) $5k SPYM $5k IEFA (or similar international fund) $3k SBUG (or similar gold fund) $3k UTES (utilities) $3k FV (sector fund that avoids tech) $3k XLV (healthcare) $3k RDVY (rising dividend fund) with the exception of SPYM - i think at least a few of these will maintain their value or go up when SPYM drops. just my opinion. not financial advice.
whatever you dont invest in stocks or index funds - buy some BOXX. (its an ETF that sells boxx spreads and goes up a couple cents every day)
i have a 401k that is 50% sp500 and 50% life cycle funds. then me and wife each have fidelity accounts with a little over $100k which includes (our emergency funds in taxable accounts which are like 30% SPAXX / 30% treasury funds like sgov and usfr / 30% BOXX and 10% sp500) then we each have a traditional and a roth - hers are both ~ 30% each of ETFs ( VOO / VTI / QQQ ) and 10% in international ETF (similar to VXUS) mine is 1 account (Trad.IRA) has all kinds of ETFs and the other (Roth) is my gamble up individual stocks account - it made ~20% more than SP500 this year - so i will do it again next year - we agreed that if i cant beat the market - then i will switch to the all ETF approach. (i am only buying shares. no options and no shorting.)
Saving on the NY state tax is nice, but you could just buy BOXX and not pay any tax. They’ve managed to avoid paying out distributions all but one month in their history. And it’s “yield” will be comparable to SGOV. I have used JAAA for cash I wouldn’t touch for 6-12 months. You could honestly use it for an emergency fund too, as long as you have probably 20% more than you think you’ll really need in that fund
Thanks, may add a position in BOXX. I need some etfs like this that won’t pay dividends as ordinary income.
BOXX tries not to do distributions and when it cannot, they are taxed as short/long term capital gains. The rest distribute as income. You can search for "ultrashort term muni" funds.
I come to learn that using BOXX may be more tax efficient if you hold for over 12 month.
I use BOXX as my Emergency Fund, SGOV as my Escrow and future IRA contribution fund, and SPRXX as my sinking fund. There are plenty of other funds you can do this with, it's just a matter of what you are comfortable with.
Hey there, always love to always love to see your update posts. Congrats on the consistent gains. What is your opinion on the ETF BOXX? It is essentially an ETF that runs a box spread strategy and pays the risk-free rate over time through stock value appreciation.
looking for some advice on the portfolio im building to buy a house with in 4-5 years time, not looking to get rich, just to make as much money without risking much, looking to dump 500+ a week in with these percentages: 40% VOO (Vanguard S&P500) 20% BOXX (Alpha Architect 1-3 Month Box) 20% QUAL (iShares MSCI USA Quality Factor) 20% SPVL (Invesco S&P500 Low Volatility) TIA
I use BOXX + BRKB + VT (1.66% divi)
That’s what prime money market funds are. However, yields spreads on corporate bonds aren’t that great. They also aren’t as tax efficient as SGOV. BOXX is an option if you can hold longer than a year and the tax arbitrage is worthwhile.
JPST MINT GSY NEAR ICSH PULS BOXX https://etfdb.com/etfs/bond-duration/ultra-short-term/
I had been using SGOV and BIL (just with ever one let me round out my cash). Then I shifted to using BOXX because it's less work and offered more control on how I realized gains. I've slowly been moving out of the curve with sales of BOXX and going into SHY. For the long end. I have IEF for my tax-exempt and TMF for my taxable.
With ambiguous purchase dates, you could assume larger risk, like a slight equity index allocation, maybe longer duration risk like intermediate treasuries rather than tbills, etc. Either way, the two best looking cash-like risk free rate investments are SGOV/CLIP or BOXX, though BOXX's tax treatment has had the spectre of the SEC looking over it, whether its method of avoiding capital gains distributions to make it more tax efficient for you is legal or not. Thats been murmured about for a couple years. For more risk you can use SHY/IEF for short and intermediate treasury bonds, simple index ETFs for stock exposure, you could expand the exposures to something similar to the "Golden Butterfly Portfolio", which is a variation of the "Permanent Portfolio", which diversifies between short and long duration bonds, stocks, and gold to produce a portfolio with lower-than-market max drawdowns but decent returns to preserve and hopefully increase your purchasing power. Depends how flexible your timelines are.
BOXX, hold for a year and get better tax treatment
A riskier box spread ETF like BOXX can provide sub 5% returns every year, and it acts like a government bond. He doesnt even have to risk the money given to him if he just parks it on SGOV or BOXX.
have you considered BOXX? BOXX hasnt seemed to reduce its daily return, even after fed lowered interest rates. (BOXX is a covered call fund that goes up 1 cent every day + some days it goes up 2 cents. but it never goes down.)
Lol, you are way more concerned about my position than i am. Thing about selling puts with the intention of getting shares, is that the only time i actually care, is about a few days before expiration because i will either want to roll for more credit to drop share price even more or if im ready for assignment is to sell BOXX to get the cash needed for assignment. This is a longer term position so weekly pullbacks dont really matter to me.
Are you okay wirh a 40% drop in value at year 4? You could consider doing a ladder of buffered S&P500 ETFs: MMAX, MAXJ, SMAX, DMAX and PAAA or BOXX (20% of each). Some market upside potential with drawdown protection. It all depends on your risk tolerance. I'm very comfortable with this very limited risk profile for a short-term investment, others may not be.
+1 for BOXX, this is exactly what it was designed for
Yes. 👍 BOXX looks like part of a solution. Perhaps combined with the other suggestion of fixed annuities.
Look into BOXX, basically executing and roll over box spreads
How about BOXX? I think it uses futures contracts to convert bonds interest into NAV growth which can be deferred and taxed as capital gains on sale. It doesn't seem useful to me at my current income so I haven't looked into it too much, and I might be explaining it wrong, but it might be worth looking into.
I'd give you a bit more credit than that. Not many would/could have done what you did. I, for example, graduated into the GFC, could barely get good work despite having a good college degree, still I was lucky enough to have work, not many saved nor invested back then but I did what I could, and I made some good investments (GOOG/LVMUY) but also bad ones (T/INTC) instead of just indexing and chill despite being a fan/student of Buffett. I didn't start indexing and index leveraging until the pandemic dip. So congratz & fuck you, but make sure to pat yourself in the back. p.s. I read your other posts about why you're getting out now, but what are you going to? Just deleverage into 60/40 VOO/SGOV? All into BOXX/SGOV? 3/7/10/20/30 yr bonds? Gold? Just taking cash and going to Thailand?
While it hasnt yet, BOXX is set to implode if the IRS looks at it and they want to get rid of it Personally I'll stick with investments i am more sure of and that I don't think are illegal
Deferred taxes on BOXX which is same investment strategy. I am holding that until January
I think you need to understand what bonds do. They pay out interest, they don’t ‘grow’ the way companies do. They can fluctuate in value but there isn’t any ’growth’. If you just want the share price to go up, BOXX is the closest thing that does that. Or just turn on DRIP on SGOV so your share count increases over time.
If you turn on DRIP, SGOV will be as stable and linear up and to the right as BOXX is. https://testfol.io/?s=hRZechuecLM
Emergency funds are for emergencies and should be liquid (access within 72-hours or less) and not tied to market fluctuations. Ideally, they should grow with at least inflation, after tax. FXAIX fails that test because it’s subject to market fluctuations. I personally am using BOXX for my emergency funds within a taxable brokerage. This can carry some tax advantages (deferred LT CG) but has potential future tax risks (IRS changes tax treatment). I am in a state without income tax and willing to take the risk.
The guy didn't say he was going to put the money in an individual stocks that can drop 80% ($100k to $20k) in one day or even 80% in a week He said the sp500. Name the last time the sp500 dropped 80% in a week. It never fucking happened. And it's not going to happen next month or next year. Look at the other side - what if you have an emergency fund (mine is $20k) I have $8k in SPAXX/ $7k in BOXX and $5k in sp500. Instead of averaging 3.7% with SPAXX only - my emergency fund is averaging (3.7 * 8 + 4.3 * 7 + 10% * 5) (more like 5.5%) - if an emergency comes up where I need $8k I am good I got it in SPAXX. - if an emergency comes up where I need $15k I got that in SPAXX and sell $7k BOXX - and God for id I need to cash out sp500 - I am willing to take that level of risk that hopefully the sp500 won't drop 80% the same day my emergency randomly comes up.
You are correct with your explanation, but you are wrong about the terms. >Selling a put requires you to have the cash equivalent of the cost of 100 shares if assigned (150 \* 100 shares) this buying power is in lock up/not tradable for the duration on the short position. This is a Cash Secured Put (CSP) which can be done in a standard margin account. A CSP will do what you say above. There is a different option permission brokers usually call "Naked Put". A naked put can be cash secured if you wish, but the broker will no longer lock out that cash and prevent you from using it. They will instead take the value of your account and calculate a "buying power" number from it which also includes the value of any marginable securities such as stocks and ETF's. This "buying power" number is then reduced each time you sell a put, but not by the full put notional value, only a fraction of it. Note you are not borrowing this amount on margin, and you do not need Portfolio Margin account for this. [https://imgur.com/a/737oWIh](https://imgur.com/a/737oWIh) So for example if i try to sell the AMD Jan 21 2028 $210 put its telling me that my margin impact is $8730.56. That means if i have $21000 worth of say SGOV or BOXX in the account i could sell 2 of these puts and still be fine based on its margin requirement. Doesn't need to be in an interest core cash position or anything of the sorts.
Might also consider BOXX It's been real consistent goes up 1-2 cents every single day. Never goes down. I like it as a cash equivalent holding (Does not pay much dividends so it's not taxed till you sell)
>That's 34 Delta on the month, meaning there is a nearly 70% chance that the price will not hit that price within four weeks. Delta is very very roughly related to the probability of expiring ITM, look at it like this just a week ago on Oct 1 there was very slight possibility of IREN going from $47 up to $60 yet here we are. With the momentum that IREN has the only thing you should use delta for is $1 increase in IREN causes the contract to increase by the delta at that time. >$75 strike covered calls with 11/7 expiration are selling for $4.30 You are looking at the ASK, which is to buy that contract, to sell it you might be able to get near mid fill, but you sell at the BID which is at $3.80, so quite a bit less than the ask. And not quite your 7% return. >Tldr; skip buying calls, think about buying shares and selling calls (need at least 100 to sell one contract). You are one step away from getting it. Instead of outright buying the shares and selling covered calls, could instead be a bit more defensive and park the cash needed in an interest bearing instrument(so it keeps earning interest while you wait) and then sell a CSP against it for $60 put for your same expiration which is going for $8.10 at the bid. This allows you to lower your share cost if you get assigned by $8.10 which means you effectively would be buying it at $51.90 or if it stays at or above $60 by expiration allows you to collect the $8.10 premium as profit which would be 13.5% yield on cash on top of the yield that would get from the interest bearing instrument like SGOV or BOXX. Best part since are not tied down to shares if IREN does take a detour for a bit but still feeling bullish on it, can always roll the put out further in time and possibly lower in strike for more credit. But to find out more you will have to visit r/thetagang
At one point I used BOXX, which paid like SGOV but maybe had a little better tax deal
Consider making a fidelity account get all your money in there and buy a fund called BOXX It perform like a money market account but with no dividend and no tax implications. (Makes average 4% APR) By every single day every share you own goes up 1 cent or 2 cent. Never down. Only up 1 cent or 2 cent. Every day all year. (It's built around using options and it works) You can get all your money in there and take your time deciding when to go into stocks or other investments.
in terms of fixed income, SGOV and BOXX yield a little bit more
I used to be an ICSH guy too until learning about BOXX. Check it out. Interest accrues onto the price of the ETF, so you never have to pay taxes until you sell and then you pay at capital gains. It’s pretty sweet.
SGOV or BOXX for short term savings, or you could get the T-Bills yourself if you don't mind the hassle
I'd go with somehting like a combination of SGOV, PAAA, BINC for a 3-4 year time frame. If you want some equity exposure, maybe some BALT. If you want to avoid taxes for the next 3-4 years, consider BOXX, BALT, SUB
How much are you converting each year? You'll have to keep the money invested in BOXX for a year to get long term capital gains, so you'll have to keep a least 1 years spending in a regular HYSA or similar.
BOXX is the only thing that comes to mind
You really competing BOXX and SHV to GME ? What does the amount of money that an ETF has have to do at all with the amount of money a holding company has ?
And conveniently ignore that exercising warrants increases the shares outstanding. Wait until the GME holders discover how much cash BOXX and SHV have with zero debt.
Option buyers think that the contract should/will be worth more than what it is currently trading for, and option sellers think the opposite. It's two parties making a bet that they have more alpha than the person on the other end of that trade If you believe in efficient market theory, assuming both parties aren't insider trading, neither of them have any alpha; over time, both buying and selling options is capital neutral sans trading fees & borrow rates (leverage is not free: see BOXX) Option buyers want leverage and option sellers want less volatility. Using recency bias and claiming "MSTY is stupid because MSTR outperforms" is like saying "QQQ is stupid because TQQQ outperforms". No shit, sherlock, the product with more leverage outperforms during bull markets Or inversely, if it was January 2023, I could use recently bias to claim "I sold all of my QQQ for JEPQ; look at the 2022 chart!"
Hell even if they can match VOO return over time it would be interesting but I doubt they can. Then again BOXX pulled it off when it comes to t-bill alternative.
I'd toss most of it back into QQQ or VT personally, but 7% cash isn't gonna ruin you. Also maybe something like SGOV or BOXX depending on the spread between its returns and your MMF
Oh I’ll be back in for sure, I’m only 43. I’m just still chilling for a bit. Nvidia is slightly up from when I sold but the market is reaching ATH and my other stocks are doing well. My big trade is parked in BOXX so it’s growing with interest
Another option is BOXX, which is a box spread ETF. You can trade in and out of that, and as a benefit they retain most earnings, so the taxable event occurs when you sell, possibly at a long term rate, rather than through distributions.
IMO, the best defense against sequence of returns risk is to use a variable withdrawal method rather than a 60/40 stock/bond division. You can check out various stock/bond divisions and various withdrawal methods using ficalc.app. I am 3 years away from retiring and have roughly 4% in BOXX in my taxable account and all the rest in index stock funds. I recommend the 95% rule because it is simple and easy to follow. Set your minimum withdrawal to equal your mandatory expenditures. Set your maximum withdrawal equal to double your "normal" expected expenditure.
SGOV pays dividends that won’t offset your capital losses. Dump it into BOXX instead.
Unless you want to take on duration risk, the main optimizations to be made are on taxes. Are you going to hold for > 1 year? Are you in a low/no income tax state? If so, BOXX would be an option worth looking at. BOXX will have a similar return profile to SGOV, but without any expected distributions, meaning no taxes due until you sell. If held for more than a year, you'll only pay long-term cap-gains rate federally, saving some $ relative to SGOV's income status (and if held for many years, saving even more $ from deferral/compounding). The main gotcha is that you will pay state income taxes unlike SGOV, however that again is only at the time of sale. If that isn't enticing, SGOV is a good option and shoudl yield more than FDRXX I'd wager. 4.44% is the prior 12 months yield on SGOV though, the SEC 30 day yield of 4.23% would be a better approximation of SGOV's forward after-fee yield.
The best you can do is just diversify with assets that are hopefully uncorrelated so you can buy low sell high and use assets doing well to buy more under-priced assets. I have some gold, bonds, stocks split 50/50 US/International..some total world market some value tilts, a little leverage, some funds that use momentum, some cash in BOXX...Things that hopefully won't all go down together. Gold is just a yellow rock but it has held its value for 1000s of years. As Rome was falling a guy with a sack of gold was way better off than a guy without it. US treasuries have been THE safe asset since 1945. WIll Trump change that? no idea. I hold gold in the hope that is the market crashes tomorrow gold doesn't crash at the same time, and I can re-balance that to buy the market cheaper. Same thing with bonds. I don't hold bitcoin because, thus far, it seems to crash in tandem with the market making it worthless as a diversifier and I am not all that convinced that a bad enough crash will not crash it so far people lose faith in it. The real answer we are all just grasping at straws and though past performance is no guarantee of future results...past performance is also the only data we have to go on so by necessity it is what we use. Try and build a bucket of uncorrelated assets each with positive expected long term return on its own, pick a re-balancing time frame or strategy that takes advantages of that uncorrelation, DCA as often as you can and as early as you can with as much as you are able, and pray to whatever deity you think will listen. I am partial to the goddess Fortuna myself.
The first rule of BOXX is: you do not talk about BOXX :)
What is your state income tax? Federal tax bracket? If in a high state income tax and/or lower federal tax bracket, just buy SGOV (could roll your own t-bills but the ER is low...) and be sure to appropriately file your taxes since most of the income will be state tax exempt (1099 won't show this automatically). Higher yield than money-market funds (since they charge more ER). If you are in low/no state income tax situation, or are in a very high federal tax bracket, I would take a look at BOXX. You won't get state tax exemption, but it is designed to give similar return to t-bills, but without any distributions, thus if held for > 1 year it turns into a long-term capital-gain, and you won't pay any taxes until you sell in 3 years, deferring and reducing the tax-rate. Some advice, stop listening to people that say they know when and how much the market will drop/rise... that is just silly click-bait.
There are several that are good. USFR - SGOV I like BOXX - it gets you 4.29% and you don't pay taxes till you sell. Share price goes up 1 or 2 cents - every day. Never goes down. Make 50cents per month per share. $6 per year. That's 4.29% like clock work. Simple and efficient. Some folks wonder if the strategy will last forever? I don't know but I keep buying 1 share every week until I retire - or until the share price stops going up 1 or 2 cents everyday.
BOXX is an alternative, no need for forced dividends → forced taxes.
BOXX I bet it beats everything based on your ratio
I don't expect them to remain the same - but I expect if BOXX and SGOV rates go down - that likely means the fed lowered interest rates and my VOO and VTI holdings will rise - likely more than SGOV or BOXX rates decrease.
Yield from securities like SGOV and BOXX are not guaranteed to remain the same. Not supporting his case, but it would be a disservice to not mention this.
My father in law sells whole life insurance. He drives me nuts with trying to explain his advantages - Salesman -But it works like a 401k - (me - why not just get a 401k?) Salesman - but you can get guaranteed 4% rate of return (me - but why would I want that when I can get guaranteed 4.2% from BOXX OR SGOV - and I can get a lot better than that from VOO or VTI - even though it's not risk free - it's pretty damned consistent) Salesman - but if you die your wife will get all this - (me - but if I die she will get even more from my 401k and VOO holdings) Salesman - but our company charges very low fees! (Me - but fidelity charges me zero fees!)
Have you ever heard of a stock called BOXX? It only goes up and to the right.
If you have enough money in your account to consider this as a viable plan - I would research BOXX and consider that as an option for at least part of your funds. BOXX accomplishes a very similar (OR HIGHER) interest rate/gain as SGOV or SPAXX - but also decreases tax liability because you only get charged gains when you sell
0% liability because I live in one of the few places on earth the IRS waives taxation: Puerto Rico. Right now it’s in BOXX but I plan to rebuy Nvidia if it drops in the next 3 months or maybe just some of the mag 7 stocks.
Interesting, I'm currently holding a ton of money in VMFXX. Not sure if it is worth the risk of BOXX or not. Chance of audit, chance of the ETF issuer doing something incorrectly.
I just looked at BOXX and going from the 1 week to 1 month to 3 month to 1 y to 5 y to all time charts made me laugh. Can you ELI5 what the hell I'm looking at? My jab in the dark is that it's tied to bonds? Also, why is it controversial?
BOXX. It's controversial, but I hold 7-figures in it.
With no state tax and a two year horizon, give serious consideration to BOXX. It will return very slightly higher than a money market fund or SGOV, but if you hold it for over a year you will only be taxed at the longterm capital gains rate (while savings accounts and money markets are taxed as ordinary income). Even if you hold BOXX for less than a year, it still is only taxed the same as the savings account, but with the possible advantages of short term capital gains.
Not as much - short-term bonds like VDST/BOXX usually drop less since they have low duration. In a sharp crash, they might dip slightly, but nowhere near equities. Think stability, not full immunity.