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am i stupid? I thought inflation will surprise up so i bought 5-10Y inflation bond TIPS (ticket SPIP) why did it not jump when inflation new come bad? what i miss?
Can I ask why not consider an inflation protected bond ETF, such as SPIP? I bought shares not too long ago and yields 6.9% right now with a 0.12% expense ratio.
You're 38/39 and still have entry of time for the market to smooth out any current and future volatility. Your monthly income seems significant to invest most of what you have saved but don't feel stressed to jump in all at once. Figure out a threshold/amount you're comfortable investing and put in that amount. Certainly not all $130k but at least enough to allow for the remainder to have 3-6 months liquidity in case of emergencies. You can limit risk through buying broad market indexes ETFs like VOO, SPY, etc. With inflation now, there are also ETFs that hold inflation protected bonds that are paying 7% or more in yield with low expense ratios. The one I have is SPIP.
Another option is SPDR Inflation-Protected Bond ETF (SPIP), or something similar. Distribution yield of SPIP is 7.72% right now.
I really like SPIP for TIPS but I do enjoy buying bills and notes directly.
I've been buying a bunch of different flavors: SCHP (monthly divs @ 6.91%), VTIP (quarterly @ 6.09%), SPIP (monthly @ 7.79%), TIPX (monthly @ 7.01%). I hedge price drops by selling ATM calls a few months out and roll it when needed. It works better with the monthly versions since it will generally net a profit if they get assigned after a couple of div payouts.
If you want it to sit on the side and not lose value try SPIP.
Yup I already own SPIP but am considering shorting GOVT and adding to my SPIP position. Thinking of doing a 2/3 SPIP long 1/3 GOVT short and wondering what I need to consider
I just bought SPIP and ARCC for the dividends. They are pretty cheap right now and have a decent yield. I also am in steel, copper, shipping, and oil. For big chunk gains, I do some verticle spreads when I am fairly certain about the short term direction of a stock. I'm up about 70% for the past year.
Unlike Series I savings bonds, TIPS are not inherently advantageous during periods of high inflation. TIPS are marketable securities like other bonds, and carry the same risks. If you believe inflation will be *unexpectedly* high, it makes sense to buy TIPS bonds. If you believe inflation will be unexpectedly low, it makes sense to take a short position. And because they're traded on the secondary market, you don't need to buy them individually. You can hold them more easily through a fund. There are many funds: [DFIP](https://us.dimensional.com/etfs/dfip/inflation-protected-securities-etf) / [FIPDX](https://fundresearch.fidelity.com/mutual-funds/summary/31635T104) / [VTIP](https://investor.vanguard.com/investment-products/etfs/profile/vtip) / [VIPSX](https://investor.vanguard.com/investment-products/mutual-funds/profile/vipsx) / [STIP](https://www.ishares.com/us/products/239450/ishares-05-year-tips-bond-etf) / [TIP](https://www.ishares.com/us/products/239467/ishares-tips-bond-etf) / [SPIP](https://www.ssga.com/us/en/individual/etfs/funds/spdr-portfolio-tips-etf-spip) / [SCHP](https://www.schwabassetmanagement.com/products/schp) / [PBTP](https://www.invesco.com/us/financial-products/etfs/product-detail?audienceType=Investor&ticker=PBTP). Some focus on short-term TIPS.
Focused on fixed income or inflation adjusted bonds then. ETFs like QYLD or SPHD for fixed income. SPIP for inflation adjusted bonds.
Be careful with the concept of "safe". Once you're navigating away from short term fixed income options you're opening yourself up to the prospect of principal loss. QYLD is as much of an inflation as the general market is an inflation hedge. Also, as mentioned, that 10% yield will be a fraction of that after tax. SPIP and SCHP are both treasury inflation protected bond ETFs. It is true that they will act as an inflation hedge. What they will not prevent is losses from rising inflation rates. Short term TIPS are a better hedge against unexpected inflation but do come with lower absolute potential returns due to lower duration. VTIP is an ETF that offers this exposure. If your goal is to purchase over the next few years, short-term bonds are a more prudent investment than longer term bonds or covered call strategies.
If it is a short-term play to shift money without losing to inflation, you can put it in covered call dividend ETFs. QYLD is very popular and pays 10% annually after adjusting for expense ratio. The payouts come monthly. You will get taxed on the gains in a regular brokerage account. Avoid putting it into a retirement account because you will get penalized for early withdrawal and potentially taxed too. Another choice for the short term is TIPs. ETF SPIP or SCHP are great choice to stay ahead of inflation during high inflation periods. [TIPS\_Definition](https://www.investopedia.com/terms/t/tips.asp)
Any bad year could see a massive drop that takes a good 2 years to recoup it's orginal value + inflation. SPHD is a low volatility dividend ETF, so it won't be hit as hard as VTI in a really bad year. Also it pays dividends out monthly. SPIP or SCHP are inflation adjusted bonds. They stay ahead of inflation in most years and they don't have massive dips like VTI during bad years.
If you are investing for 5+ years, start now with dollar cost averaging (DCA). Basically a fixed dollar amount every month Otherwise stick with dividend ETFs (SPHD) or inflation adjusted bonds (SPIP or SCHP) for short time periods.
Inflation adjusted bond ETFs (TIPS). Look into SPIP or SCHP.
Interesting. I've barely looked into anything beyond Vanguard's BND, but just curious whether the risk inevitably is effectively no different (in contrast with stocks) and whether the dividends pay off better? I notice the noticeably higher expense ratio with SPIP, but SCHP seems reasonable
Maybe TIPs to stay ahead of inflation. SPIP or SCHP to name a few.
Tips are a good choice. Look into exchange traded funds SCHP or SPIP.
Bank ETFs: XLF or FNCL. Or TIPs: SPIP or SCHP.
I just retired in December and until that moment 100% of my retirement portfolio (excluding the house I live in) was in stocks, mostly growth-oriented with some spillover into dividends (for example, I bought AAPL as a growth investment, but they happen to pay an annual dividend of a whopping 88 cents per share). So I'm supposed to be reallocating part of my portfolio to boring, safer, capital preservation instruments, and I suppose that I should have started doing that a lot sooner, but my stock-investing habit has been hard to break. I see a lot of models that push toward 45%-50% bonds/cash. Ugh. I'm still mapping out a strategy, but in the meantime I've laddered some CDs over the next two years (slightly better than burying cash in the backyard, but only slightly) and focused recent stock purchases on stocks in large, boring, stable companies to bump up the income from dividends. I also pick my spots to sell covered calls here and there to generate immediate income. I threw a little cash at those Series I bonds that others have mentioned, but remember you have to wait five years before you can cash those out without interest penalties (the previous three months of interest), and if you hold them outside of an IRA, 401k, etc., the IRS treats the semiannual inflation adjustments as taxable income, even though you won't see any money until you sell the bond or it matures. If I ever come to the realization that I should be a boring, conservative, old fart with a healthy chunk of retirement savings in bonds, I might take a look at TIPS ETFs. Candidates include LTPZ, SPIP, and GTIP.
Inflation adjusted bonds called tips. SPIP and SCHP. Another choice is dividend ETFs. SPHD or QYLD are popular choices.
You can always put it into inflation adjusted bonds like SPIP or SCHP, or dividend paying ETFs like SPHD or QYLD.
If you're really concerned about inflation, look in to TIPS (Treasury Inflation-Protected Securities) or TIPS ETFs. Examples include $LTPZ, $GTIP, and $SPIP If you think inflation is going to stay at >6% and the market is going to take a big hit these are the move as what ever you invest in would . The hard part is figuring our when to get back into the market because with how quickly the market can rebound missing even the first day or two of a recovery can Some people I know who are bearish are selling their securities and moving it all into TIPS. Personally I'm leaning towards storing my cash in TIPS ETFs, not investing any more into stocks in the short-term and holding my existing stocks as I don't have many short-term positions. I'll continue building up my cash reserves in TIPS to protect them from inflation and when a dip occurs sell those and put it all back into stocks to bank off the recovery.
If you're sitting on a lot of cash and worried about inflation why not park it in SPIP or a similar TIPS etf? You get a nominal return if things are flat and if inflation pics up, so does the NAV.
Look into Treasury Inflation-Protected Securities and tell me what you think, I believe I have 15 contracts on SPIP which is composed of inflation-protected US Treasurys with a remaining maturity of at least 1 year, If we think hyperinflation might happen I'm using it as an inexpensive hedge