IAGG
iShares Core International Aggregate Bond ETF
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10k sitting in savings + $200 a month investment advice
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What's a good option for unhedged international bonds with low MER? I think IAGG and BNDX are both hedged. Maybe IGOV but the MER seems kinda high.
On the “whitecoatinvestor” website’s 150 portfolios better than yours post, a Boglehead adjacent strategy of keeping up to 10% in non-Boglehead investments and speculations (individual stocks, factor funds like SCV, crypto, bonds/funds of, gold, etc, etc..) is right below the “3-fund portfolio”. Which should be a 4-fund portfolio with BNDX or IAGG. Still think the basic idea is keep market cap with a few funds for most investments to simplify life .. while letting the market work for an investor long term. Having some “wilder” investments bordering on speculation and/or a bond ladder, esp when older, can work.
Full disclaimer: I haven't invested in bonds in a very very long time. So, this is probably a better question for r/bonds . I would probably choose an etf like IAGG and pare it with an emerging markey bond fund for greater diversion and yield. I would want about a 7 year duration or less.
I swapped out AGG for IAGG in my taxable for this reason. Unfortunately Munis need to be US for the tax benefits.
Why is IAGG (a bond fund) up 6% after hours?
Oh IAGG is hedged? Whoops I thought it wasn't lol
IGOV is significantly more volatile than IAGG. I couldn't tell you whether that's bad though.
Bonds are their own monster, and I'm not an expert, but these are the three unhedged (fitting your dollar thesis) that I'm holding: CBON, IAGG, IBND
I can't figure out if IAGG is better or not.
I've been thinking about a small percentage of IAGG in an IRA, but I think a weakening dollar may also kill bond ETFs like 2022? I feel good about maybe 10% fixed income at the moment even though I won't retire for 30 years/never and it feels silly to have SGOV be the best choice, but it seems like it.
I'm also convinced the US is probably over, but I thinthat's backwards. They will try to maintain normalcy for the average person as much as possible so he can just refuse to leave and people will say "well I'm scared of the police so I guess we're phasing out democracy..." If I had a lot of money I would probably feel comfortable in VEA and IAGG. Your cash won't help you in the apocalyptic scenarios anyway.
So did a short research. If this does happen. One could consider going to VXUS instead of VTI and IAGG for fixed income instead of BIL. If Powell is fired, new Trump’s yes man will drop rates. Inflation and $$$ devaluation will be the outcome.
IAGG is coming up as lower return somewhat safe investment.
Technically, you can't have a firm grasp on stock index funds if you don't understand bonds since the DCF for stocks has the same factors that bonds have plus additional factors. But I get what you mean. You don't need to know DCF to just buy and hold a broad index fund long term. Bond funds tend to be more varied. You don't have a net loss of 3-4% over many years. You are looking only at the price change and did not include the income distributions. Here's a total return chart: https://stockcharts.com/freecharts/perf.php?IAGG,MUB Bonds have two main factors: duration and credit. Short duration, high rated bonds will be close to cash and very low risk. Long duration, high rated bonds will be more volatile, even approaching stock volatility for the longest durations. But not very correlated to stocks. Lower rated bonds will be much more correlated to stocks. IAGG has a portfolio of foreign government and investment grade corporate bonds. It hedges the currencies so it acts like an index of USD bonds. It has medium duration and medium high credit rating. It's interesting that your advisor went with IAGG over a domestic bond index like AGG, though there's not that much difference because currency hedging will tend to equalize the yield and the duration and credit exposure is similar. Maybe they thought the yield curve looked more attractive in other countries at the time. IAGG has outperformed AGG over the past few years, so if so, they were right. MUB holds municipal bonds which are not taxed at the federal level (or the state in which they were issued). Also medium duration and medium high credit rating. These are most suitable if you are in a high tax bracket; less useful if you are in a lower bracket.
Many years ago we had hired a financial advisor to help us with our accounts who gave us an investment portfolio. Now after learning quite a bit more we are questioning the allocations and would like to simplify and rebalance. Seems like there was too much international investment, and it was distributed amongst some small and medium cap funds. However, we are still fairly new to all this. I understand what a bond is in principle. However, what is really eluding my understanding is how to analyze a bond fund. I feel like stock index funds are easy to grasp, and see returns over time, and what the investment portfolio looks like as a whole. However, bond funds seem to be much more difficult for me to understand intuitively, and figure out which to invest in. For example, we have a pretty significant investment (about 20% total) in [IAGG](https://digital.fidelity.com/prgw/digital/research/quote/dashboard/summary?symbol=IAGG) and [MUB](https://digital.fidelity.com/prgw/digital/research/quote/dashboard/summary?symbol=MUB). Both of these funds appear that we have a net loss of about 3-4% in the lifetime of our account, but I cannot find any average long term returns for the fund, or any details that are prominently displayed for stock mutual funds. As a bonus, are these two bond funds even worth holding? Are there any that are generally superior for just safety. Seems like we are just losing money on these over their lifetime.
Thank you all for your feedback, i have decided to simplify my portfolio and adjusted it to **90% VT** and **10% IAGG.**
I wonder if it will mimic the holdings in their Asset allocation etfs that are pretty much like index balanced funds like vanguard lifestrategy or Fidelty four in one index fund. , I guess time will tell. For the record the ishares asset allocation etfs use IUSB for US bonds and IAGG for international bonds. Along side with their SP500, SP mid cap , and SP small cap for US allocation, and developed and emerging for international.
Hello. I have 10k just sitting in my regular savings account doing nothing. I currently separately invest $200 a month into these with these distributions: FXAIX (US Stock): $100 FXNAX (US Bond): $40 FZILX (Int Stock): $30 IAGG (Int Bond): $10 FSRNX (Real Estate): $20 I use Fidelity if not obvious and if it matters. Just curious what are the best options to do with the 10k. I'm thinking of putting all or like 75% of it into the market as well but should I just compile it into these positions all the same? Or most of it and leave some extra cash in the account? Any advice appreciated including if my current investments aren't great. Thanks. Some have suggested high interest savings account but I'm also thinking about maxing a Roth IRA for this year?
AGG, IAGG, EMB, TLT, BND, HYG are about 7% of my stock bond portfolio. Liquidity for an extreme stock dip.
AGG may very well rise in value if stock markets tank, but HYG will not. It's not as great a diversifier as Treasuries. For that reason, I would not call it a low-risk investment. If you want something that has a low correlation with stocks and has some chance to diversify vs AGG (and TLT as kiwimancy suggests), try IAGG. Be careful with the FX, though, you may want to buy a hedged share class. If you want something similar in risk profile to HYG, try EMBI. In my view, the sweet spot atm is in HY EM dollar sovereign bonds, which you can access through mutual funds (search for frontier debt).