VCLT
Vanguard Long-Term Corporate Bond Index Fund ETF Shares
Mentions (24Hr)
0.00% Today
Reddit Posts
Mentions
Buy ETH FIGR BTC and VCLT. Low inflation low growth assets
i guess you're correct. but for some reason last week I thought I could make a couple $ with some Jan calls. VCLT looked so beaten down....
can confirm. my VCLT calls went into the toilet.
bond funds (TLT / VGLT / VCLT)
>I get the sense you're just in the mood to argue on the Internet. 🙄 Lol >There is always a chance of a stock market crash. By some definitions they happen every 7-8 years. Yes but you got zero knowledge of how deep a crash will be. You could set your stop loss for 15% and then the market drops to 17% before rebounding and oh wait, that sounds familiar actually. Didn't that exact situation just happen back in April with the SP500? Yea, terrible strategy >or the tariff debacle this spring Yea so I transferred $235k from VCLT into VOO on April 8th because I said "oh look, nice discount there" and it turned out to be the bottom... but that wasn't even my goal hahaha >You can have all the conviction you can muster, but your investments do not live in a spreadsheet. Wtf even is your point here? Lmao
Depends what you're trying to achieve. I have positions in T-bills (SGOV would be the closest match), VCLT, TLT, ANGL, FXNAX, MUB, and some individual in-state municipal bonds. > I know of only a few that are worth investing maybe 5% of someones portfolio in. Is that to say, in your view, for *anyone* regardless of their age or investment goal time horizon, you can only imagine at most, 5% allocation into bonds?
I have an HYSA at 4%, long term investment grade bonds at 5.5% (VCLT for example has a 30 day SEC yield of 5.85%). And you can get around 6.5-7.5% high yield (junk) and CLOs. The long term return of such things are quite solid from what I saw. But all these things - except the HYSA - come with increased risks. Still at 4% and 30% marginal tax rate, an HYSA at 4% is only 2.8% net, less than the 2.99% rate of OP. Also not sure we will keep 4% or 3.8% return for the next 10 years.
Honestly not bad, but for somebody retired, as long as the yield is here, fluctuation in values are not that important. Keeping that in might and trying to simplify a bit and get a bit more yield I would consider something like that: 30% VT 20% VCHD 20% VCLT 10% VGSH 10% GLD 10% in an REIT ETF.
lost so much $ on this nonsense. basically holding VCLT on the off chance Powell caves on friday and drops the interest rate, arthur burns style. their bonds go up 12.6% in value for every point it drops.
Coming to reddit for a non-bias opinion on anything is kind of a vain endeavor. Something to keep in mind is the almost universal truth of "if it's too good to be true, then it's too good to be true". Many of these super high dividend ETFs have very high expense ratios, which means the fund managers charge you more for the maintenance of those funds. Additionally, something to look at is what kind of companies these funds are investing in to actually attain the yields they are advertising (10-12% dividends). Companies that offer extremely high dividend yields often do so at the sacrifice of stock value. So while your investment may be returning something from dividends, you may lose money on your initial investment by losing stock value. In my opinion (and that is all it is), if they were a great and legitimate income source, then everyone would be buying them up. I once bought into DIV and SDIV because of promises of big dividends, but in the end, those ETFs lost so much value that it almost negated the dividends they were turning out. I dumped both of them in exchange for more stable income sources like bonds (VCLT) and money market funds.
I’m going to preface with some baseline assumption 1. your nest egg is enough to maintain your desired standards of living. 2. Your risk tolerance is the let’s say same as average people. Your target goal is to slowly drawdown your nest egg and maintain the purchasing power. - can’t go too safe like all fixed income or fixed annuities or inflation will just eat you alive - can’t take a lot of risk either since regardless of market condition, you still need to take withdrawals and you don’t have the condition to recover well. Inflation: a few things to consider for inflations. - TIPS adjust principal with inflation - equities does hedge somewhat against inflations So how much allocation? I think 70/30 is OK for the few years but 60/40 maybe safer. I think as long as it’s over 50 it should be OK I’ll go with 6/4 - - Bond - 20 AGG broad bond index - 10 TIP just the tips - 10 maybe a corporate bond? Like VCLT? Or just another 10 on TIP - equity: broad base diversification. Diversifying beyond just US equities. Goal is to take only market risk…world market. - 35 VTI - US all cap so more than SP500 - 25 VEU - world ex-US
Hoping someone will comment on my response because I'm really curious about what people think of this. I've been thinking of the same thing as you. But instead of keeping my money in cash I was going to invest in bond ETFs. They will be more stable but give me an income. Looking at a couple for the last 10 years (USIG and VCLT) the prices are actually significantly lower than most of the last 10 years. What do people think of transitioning from equity ETFs to bond ETFs?
I see this as an opportunity. 10 year treasuries have gone from 3.6% to 4.4% over the last few months. The Fed is keeping its eye on the ball for 2% inflation; it may take a while to get there, but the direction is clear. Given that, I don't see long rates going much higher than they are now. Going with long term investment grade corporates in a fund like VCLT gets you a 5.6% yield, and it seems like a good buy here for money you want to invest longer term. For money that you need to access sooner and don't want to risk short term principal fluctuations, you can keep it in short duration bond funds and get more stability, albeit at lower rates.
Won't BND go down with interest as well? I'm not sure how many short term bonds there are in that fund. Same with VCLT. I would assume a long term bond would protect you from lowering interest rates and also allow you to sell the bond (if possible) for a premium. I'm still learning. I've only read two books altogether on bonds.
Until you realize that there is a ton of overlap between something like VT and VOO, and VT has a higher expense ratio, less volume and has underperformed VOO (just using these two as an easy example). For my personal investment I just do the diversification myself for my ETFd. For example 60% VOO (essentially US large cap), 20% VB (US Small cap), 15% VEU (Lg cap excluding US) and then 5% VCLT (US Long term corp bonds). This way I get some diversification, lower average expense ratio, and (hopefully) higher gains.
I’ve been accumulating VGLT & VCLT for over a year waiting for these damn rate cuts - FINALLY I’m in the green! (2-3% - looking for 20-30%, much more if there’s actually a crash).
I am a complete newbie to investing. While skimming over the book, "Random Walk down Wall Street". 12th edition, I decided to follow the strategy given there. I am purchasing index mutual funds for my Roth IRA through Fidelity. On the long run, I want to maximize my Roth IRA. For today, I am making a purchase worth $300 - $42 - FFMAX (14%) $42 - SWISX (14%) $81 - SWTSX (27%) $37.5 - FRXIX (12.5%) $15 - FXLXX (5%) $22.5 - VCLT (7.5%) $22.5 - VGAVX (7.5%) $37.7 - VDIGX (12.5%) Am I making any newbie mistake here?
I started buying bond funds in late 2022, then moved more aggressively to individual issues and more fund shares in late 2023. Bonds are 15% of my portfolio. I am focused on investment grade corporate, high yield, and some agency bonds. Some are callable between 2025 and 2028. For funds I'm using VCLT and SPHY. The rest are individual bonds. Now may be the last good time for a while. The best (so far) was October 2023. Of course, bond traders have been playing this guessing game for quite some time now! So who knows!
That is not how bonds - *generically* - work. But that's how **municipal** bonds work, and that's what your two mutual funds hold. Municipal bonds are federally tax free. But they pay rather low yield as a result. You need to be in quite a high marginal tax bracket for munis to make sense over investment-grade corporate or even Treasury bonds. In other words, the amount you are saving by not having the distributions taxed does not make up for the lower yield. You'd have more net, post-tax money from an A-rated corporate bond even though the distribution is taxed. Now is a great time to buy up long term corporate or Treasury bond funds. Look into VCLT and VGLT for example, or even a total bond index fund like BND. Alternately, you can buy individual bonds with known maturity dates and yields, but that's a whole other ball of wax.
When they do finally cut rates, it'll be pretty sweet for my VCLT/VCIT losses
VGLT - for long duration with low expense ratio EVTR- for mid duration. I think a good mix right now is ICSH, JAAA, EVTR, VGLT, VCLT
There are a number a good opportunities to capture fairly safe income now: - Long term investment grade corporate bonds (VCLT) are yielding 5.85% - iShares Preferred (PFF) gives income and some long term capital appreciation potential, and yields 6.41% - For a bond alternative which will give them some income (about 3.5% yields) but also growth over time, consider a Utility (VPU) or REIT (VNQ) etf.
I started working around June of 2017. I was 25 years old I think. I had around 55K(for my masters) + 24K(For my car) in loans. So I was -79K net worth at that point. By June of 2018 I was at a break even point if I remember correctly. Meaning 0$ Networth. By June of 2019 I hit 100K in net worth if I am not mistaken. So around 27 years old. At that point I was keeping all of that money in a savings bank account. Then I moved it into VCLT because bonds are safer. Then exactly before the pandemic I moved all of my money into VOO(around 150K at that point) and I immediately lost 40K. I kept on going. I am still going strong. Either by this year end or June of next year I will most definitely hit 1M in networth.
Stick for bonds until stocks correct and be patient while you gain some experience learning about market cycles. Look at the bond market right now - it crashed during all of 2023 while stocks have reached new ath’s. Now that bonds are bidding at a discount while stocks are overvalued, and while retail flows into stocks are at new highs as well, fund managers and pensions are taking profits in stocks and loading up on bonds. Meaning smart money is dumping stocks to retail investors who are selling their bond allocations at the bottom while buying overvalued stocks chasing the fomo stock rally. The fed has raised rates and as of now they are pausing. This could change and this is the risk you need to be researching. Historically, stocks see a correction after the first rate cut. All the media and news touting bullish rally and rate cuts will send markets up another 20% whatever is complete nonsense. Look into bond etfs - many pay dividends monthly and bonds are discounted rn which financial networks are completely ignoring. Investment & junk grade. LQD, HYG, JNK, AGG, ANGL, SPHY, VCLT, BND, BNDX (emerging market bonds), etc. Given the current economic data, global conflicts, and worldwide elections in 2024, this is not the year to dump all your money into stocks, especially heading into the US presidential election with stocks absurdly overvalued and chipmakers going vertical because of government subsidies fueling competition for global dominance in semiconductors. Keep your cash in a money market fund for the next year and slowly begin accumulating bond etfs routinely based on your risk tolerance. Preserve capital. Wait for a crash/correction. Buy assets when they’re discounted not overvalued. Cheers!
Thanks, I'm in a pretty high tax bracket and live in CA. I was looking at VCLT and BONDX (international bonds) as well as some CA specific municpals. I liked VB as well, and have it on my list as well as VO for mid cap. For international I am actually currently invested in EMXC (good returns so far!), but was trying to keep it in Vangaurd so I was looking at VXUS as well as VSS.
If you aren't in the top tax bracket you don't need munis. I would do VT and VCLT ( VCIT if you think inflation is a longer term problem ) I would bump up small caps VB and for international exposure I would use EMXC, VYMI and/or VSS
Your Corporate bonds funds didn't tank last year? I'm still down 20% and 11% (ignoring dividends) on VCLT and VCIT, even with a little dollar cost averaging in March this year. I took my profits from 2021 and rebought them end of year, so essentially purchased at their peaks.
SMH lost 75%+ from May 2000 to October 2002. No way to know if we're in a bubble or it'll eventually correct and march higher. The Nasdaq took 15 years to get back to even after March 2000. The XLK is approx 22% Microsoft and 22% Apple, with some semiconductor exposure, that's more than risky enough for someone like OP. By bonds do you mean treasuries or Corporate Bonds? VCLT was averaging 7% annual gains and VCIT was averaging 5% (then came 2022) Now they're only averaging 3.25% & 2.65% over the past 10 years respectively. Semiconductors should remain lucrative over the long term, but don't forget the saying "real estate always goes up": The VNQ peaked February 2005 and took 10 years to come back to those levels.
If you are talking decade ish time horizon and you wanted the safest way to do a 6% return I would do something along the lines of VCLT 60% and VT 40% then the last like 4 years switch to VCSH instead of VCLT to reduce volatility.
Some intermediate and long term investment grade bond funds are paying close to 6% and the risk (of getting your income each month) is pretty low (the risk of losing NAV is moderate). Check out VCIT and VCLT. Look at the "SEC yield", not the cash yield. The cash yield i about what you get next month. The SEC yield is the approximate total average yield, over time, of all of the bonds that fund current holds.
Look at bonds - bonds are currently rallying off the lows after a substantial bear run and people who were short bonds have closed their shorts and gone long bonds. Stock indexes have basically chopped sideways for 2 years after a decade-long bull market from the GR lows followed by insane QE which is now slowly being reeled in by QT. If you’re worried about stocks correcting, the bond market is looking much more appealing. AGG, HYG, LQD, JNK, VCLT, TLT, SPHY, ANGL And understand the relationship between bond yields and bond prices.
If you want returns in a 1-4 years buy USHY If you want returns in a decade buy VCLT If you want want lifetime investments buy VT
Depending on the level of your desire to gamble, tax preferences, and tolerance for other risk factors... the options below are good. I'm mixing up VCLT and EDV for my own purposes. ​ VWALX VWEAX VCLT EDV
I guess you can look at it that way but compared to many other bond options that people have mentioned (e.g. VGLT and VCLT), it is a much better return with zero downside, it’s better than a CD or treasury. I’ll take 6.3% guaranteed for the next two years on some of my money. Wouldn’t you?
VGLT and VCLT are both losers across the board, regardless of the timeframe you use. At 36, you should avoid bonds and stay in equities, using a broad ETF (VOO, VTI) or targeted ones (VGT for tech, VHT for healthcare). If you want to mix in some fixed rate investments, just find a good CD, callable bond or treasury note.
VCLT (long term corporate) or BLV (long term index).
Now is a great time to go into a 60/40 portfolio. 60 VT 40 VCLT, done
Bond funds are volatile in a rising interest rate environment… just a heads up. VCLT is down 10% year to date. But if you held on and just used it for dividends and never need to sell any of it then it could be viable. Personally I’d go with something a little shorter term like a 12 month 6% cd or tbills at different durations. Might want to keep an eye on JEPI/JEPQ as well they have high yields , but also capture some of the equity gains / losses . I’d personally go with JEPI over VCLT. JEPI/JEPQ are higher risk with a bot so long track record… just a heads up.
I'm not retired, but getting 6.3% for 12.5 years with investment grade corporates, VCLT, seemed like a no brainer to me.
That CD is ripoff You'll earn 2% more with investment grade corporate bonds VCLT
It burns to see it go down right after you bought in, huh? It will make you go crazy seeing it go up after you've sold out too. It's a good time to go to fixed income VCLT if you don't want to worry so much about risk of collapse. If you are in it for the long haul, I'd take those losses for tax purposes and switch to VT total world stock index, then relax for 15 years.
Treasuries yes, but corporates are much less certain. If interest rates drop due to a significant recession, corporate yields may rise due to increased risks. For example, VCLT, a long term investment grade corporate bond ETF dropped 27% in value during the covid crash when interest rates dropped to 0, nearly as much as the stock market. JNK, a high yield bond ETF, dropped nearly 50% during the global financial crisis.
The spreads between US treasuries and investment grade corporates have shrunk a lot. VCLT, a ETF for long term corporate bonds, is trading at nearly the same price as it was in October 2022, meanwhile TLT, a long term US treasury bond etf, is down nearly 10%
Me personally, with the SP coming off a huge run, sitting at 25x earnings. I'd do 60% VT, 20% VB, 10% VSS, 10% EMXC Don't sleep on fixed income though. Mixing VCLT, USHY and EDV can yield 7.5%, and keep your powder dry in a correction if the Fed has to force rates back to zero.
All in EDV and VCLT With wars breaking out all over the world, interest rates are not going up Double your money in a crash
Yep it is obvious where all that printed money went when you look at charts of RE and equities. You can get a 7.5% yield with a 50/50 split of high yield bonds USHY and long term investment grade VCLT The P/E of the SP500 is 25, or a 4% yield If you drive in the rear view, equities look great, but I don't think the next decade will be like the last
Sounds like you are riding for a fall ;) You've done GREAT, but think you have 4 stock secret sauce none of the great managers or computers have figured out. Don't use margin. We are coming up on a real estate cycle in the next ~few years and you could get torched. As of today I like USHY, VCLT and EDV. IMO times have changed. Others will feel differently.
This is gambling 🎰 you need a business to do this otherwise you’re risking a lot. Maybe a vending machine business could go from 3k to 50k in 4 months lol my personal GAMBLE is I’m loading up on VCLT tho TLT would be good too I’m gambling that interest rates come down, these are hitting decade long lows and it makes me excited 😆 I’m happy with the prospects of nice interest payments every month and chance at capital appreciation but you could load up on leaps calls for VCLT or TLT as far out at the money as possible. Political pressures will skyrocket for feds to soften next year for an artificial pump. Jpow might do what he needs to regardless of who says what
I was buying TLT, VCLT and bonds directly hand over fist yesterday. I drained my checking account to a bare minimum level buying bonds. When Bill Ackman came on CNBC and he said he was shorting bonds, I knew I hit the jackpot.
I was buying TLT, VCLT and bonds directly hand over fist yesterday. I drained my checking account to bare minimum level buying bonds. When Bill Ackman came on CNBC and he was shorting bonds, I knew I hit the jackpot.
I sold all my VGLT (Vanguards version of TLT, with much lower expense fees) at the beginning of 2022, as it was obvious what would happen as the Fed started raising rates. Started buying back at the end of 22 - missed the ALL-TIME low of 57 (for a minute) - slightly underwater now. Still accumulating - bond funds are dirt cheap, and could easily go up 50% when the Fed eventually starts cutting. Meanwhile, VGLT has a dividend close to 3%, and VCLT (long-term corporate bonds) is around 5%. Sure, hindsight is 20/20, and I should have bought QQQ instead. But I like to have a diversified portfolio, which I rebalance as necessary.
I don't really know much about fixed income so bear in mind that some of the nuances are outside my knowledge and experience. ​ >I had come across this, my impression was that the risk was in line with junk bonds but perhaps slightly less. My understanding is that most junk bonds are unsecured notes. ​ >Also I'm a little confused on why duration matters with a bond fund. I saw that you posted similar question yesterday - did you understand the response. Funds are basically constant duration so it's like a perpetual bond ladder which ends up looking like an average duration and maturity. Bear in mind that there are target maturity funds as well. So with your 2 year horizon - you could use target maturity funds - like the ones from Invesco (Bulletshares) and Blackrock (iBonds). ​ >Why would someone invest in VUSB or VCIT vs VCLT for example? Or UTWO vs SGOV? The differences are in average duration and credit quality. ​ >would it make sense to dedicate a small portion of my 2 year investment strategy to equities? Like maybe 10-25%, while the rest is in fixed income? I don't like to provide an opinion on something like that. Because it's mostly down to your own personal financial situation and risk tolerance.
VZ for me, 3 years you’re looking at 22% DIV DRIP return plus they are trading at something like a 5 year low. I can see them them also adding another 20%-30% on their share price. I don’t know about anyone else but I’ll take -50% over 3 years. Currently have about 60k invested in them. I’ve also been DCA and DRIP investing on BLV, EDV and VCLT, -60k combined those are on sale right now but positions are down -20%.
Looks pretty reasonable. For the fixed income allocation (ie your bond ETFs) - just make sure you are reinvesting distributions. These appear to be 10+ year duration so that means that you should hold them for at least 10 years. After 10-12 years, you will want to re-evaluate if you should select a shorter duration bond fund. For example - in 10-12 years - it may make sense to change VCLT to VGIT. It all will kinda depend on your own risk tolerance and financial goals. You do have a slightly more aggressive portfolio with the overweight in VGT. But again - that depends on your own risk tolerance.
Hello, I am a 33-year-old female and my husband is 32 years old. We do not have a home or a mortgage, We are provided housing in our contracts. We are both international teachers and receive foreign earned income exclusion, meaning we pay zero US tax currently. We are Americans and hope to build our retirement fund as we plan to retire by the ages of 53-55, giving us about 20-22 years to do so. We have just paid off all our student loans and have a strong emergency fund of 30-35k in a High-Yield Savings account with an interest rate of 4.8% (for 6 months, then down to 4.3%). For the next 6 months, we plan to deposit $7,000 per month into a newly set up Vanguard account, and after that, it will drop to roughly $5,000 per month for the foreseeable future. I have put together a portfolio with a bit of research and would appreciate any critiques or advice. (**20 % bonds 80% stocks)** The make up of the **80% stocks** **30% VOO** **30% VUG** **20% VGT.** **20% VTI** The make up of the 20% **Bonds (really unsure about bonds this is kinda a shot in the dark)** 50**% VCLT** 50**% BLV** Thank you in advance.
Deduct your age from a hundred, that's the percentage of money that will go into VTI. The rest will go into three securities: 50% into BND, 25% into VCIT and 25 % into VCLT. Forget about your investment and check back in 20 years. Write me a thank you letter when you are rich :)
VTI, VXUS, VCLT. Don't overcomplicate it.
It's all case by case. Obviously a bond portfolio, like any other portfolio, is the culmination of its individual positions and trading activity. If you have a fund like VCLT that specifically holds long duration bonds, that means it will sell bonds when they become "too short" for the portfolio, whatever that may mean. Let's imagine the fund buys 20 year maturity bonds and sells once they hit 10 years until maturity. Even without any changes in the yield curve over time, generally the curve is not perfectly flat, so the yield of a given bond will evolve over time. Typically the curve would have a positive slope, meaning longer yields are higher, and therefore there is positive price pressure in general for a fixed coupon. If the 20 year bond is issued at par with a 5% coupon and the 10 year yield is 4%, the bond will necessarily trade above par when it's a 10 year bond, providing a positive roll yield that is actually realized by a fund like VCLT which will sell it. Held to maturity though, the price will eventually fall back to 100. If you are going to hold a bond portfolio forever, you want rates to always be high because that maximizes your income and you generally aren't affected by yield curve movements. If you're in the business of holding bonds for a period lower than their duration, you want steep yield curves (high roll return -- buy at high yield / low price and sell at low yield / high price) and, especially in long duration portfolios, perpetually falling yields. Even if yields kept falling below 0, a portfolio that buys long duration bonds and sells them relatively early would just keep printing money even when purchasing bonds at negative yields because they would be sold at even more negative yields, and the fund would continuously collect capital gains far outweighing the negative yield for the holding period. So the concept of par doesn't necessarily exist for any perpetual portfolio, but if it's a total bond index then it will generally do a lot of buying and not a lot of selling. In that case, especially over long periods, an investor would want a steep curve that doesn't really move -- a downward shift in the curve, as mentioned previously, provides a temporary price increase but, held constant from that point, guarantees an eventual price decrease as well as lower income from new bonds issued at par. For target maturity funds, broadly speaking they should have relatively low turnover and relatively predictable realized returns at their maturity. They behave pretty much like a single bond that is the weighted average of all of the bonds in the portfolio. This is another case where falling yields don't help because the portfolio is not going to exit positions early, and it will be forced to reinvest coupon payments at lower yields than before. All YTM/YTW calculations are going to assume that distributions are reinvested at the calculated yield. That's just how the formula is set up: you solve for the one, constant discount rate that matches the future cash flows to the current market price. If you don't reinvest your coupons, then your realized return in dollar terms won't match your yield (simply because you have fewer dollars invested now, which is kind of analogous to a negative leverage ratio). If you reinvest your coupons at a lower yield than whatever you calculated at a particular moment in time, again your realized return will fall short. If the whole yield curve shifts up after you purchase a bond/target maturity portfolio, then your realized yield will be higher in the end -- you will take a temporary price hit that eventually reverts back to par, and your reinvested coupons will earn a higher yield than predicted previously.
Thanks for clarifying. I think I understand what you mean. The part that I have trouble understanding is how underlying bonds moving back towards par and then maturing impact the yield in a constant duration bond fund like VCLT which OP mentioned. How is par determined in such bond funds? Or does it not matter, which is what I think you are saying. There were some similar questions in the past about how monthly/quarterly distributions should be treated in bond funds. For example - last year - I started to reduce the duration of my bond allocation and moved into target maturity funds - funds like Invesco Bulletshares and Blackrock iBonds. It wasn't clear to me if the stated YTM and YTW in the ETF tearsheets assume that the monthly dividends should be reinvested to achieve current stated YTM and/or YTW. Or are the ETF distributions simply like bond coupons and it doesn't really matter?
It is more short term. I was thinking of reevaluating when the economic conditions improve. The bonds are meant to gain some value, more than being in a savings account and more than treasuries like STIP etf, in the short term when the economy goes down. I will liquidate my position in VCLT when the economic data looks like it is bottoming and buy more growth orientated etfs like SPGP and XSD semiconductor etf when they are cheaper. I wanted some etf's which would gain a lot in value if there ended up not being a recession and the bonds underperformed.
Personally I like to do * VOO(Large cap S&P 500) 60% * VTWO(Small cap Russell 2000) 20% * VEU(FTSE All world Ex-US) 20% VOO + VTWO is technically all of US stock market. The reason I am breaking them down like this instead of putting them into VTI or some composite all encompassing ETF is because economy works in cycles. At any point of time either VOO or VTWO or Both of them will be in profit or both of them will be in loss. In the situation where I have to liquidate some of my holdings and only one of these in profit, either VOO or VTWO then I will liquidate the one in profit. A composite index fund like VTI will essentially average the gains between VOO or VTWO. So essentially I would have to liquidate more stocks of VTI when I need money then I would if I had two separate ETFs instead of one. I also hold some other misc ETFs that I am not actively investing in like QQQ, VCLT, TLT, VNQ. That I am gradually downsizing.
This is a good reason to own bond ETFs with different maturities rather than holding a total bond fund like BND. You can manage the allocations and it's a lot less painful selling VCSH to buy stocks than VCLT.
You got me curious so I looked it up. VGLT - long term treasuries, -31% VGSH - short term treasuries, -5% VCLT - long term corporate, -28% VCSH - short term corporate, -7% So pretty much depends on the duration risk, it was definitely a horrible year for pretty much everything outside commodities.
Buy VCLT for the monthly payments, use it to pay your mortgage as it comes due.
How do you plan to play the bond bounce? Short/intermediate/long term funds like VCSH/VCIT/VCLT?
Lol VCLT has a 6% yield for 13 year duration. Scary as it sounds now is the time to go into the asset everyone is scared of, the long bond.
Go to E-trade or Fidelity. Press "open account" button. Follow the prompts. They are self-explanatory. Returns vary from year to year, but on average, you can expect \~7% annual return. This year was really bad for existing investors, but an excellent point to enter the market, everything is on sale. When you are just starting, go with the big aggregate ETFs like VTI for the total stock market and VCLT for the total bonds market. Later on you can look at specialized ETFs You don't need broker to make trades on E-trade or Fidelity. However much money you want, there are no limits. Depends on how old you are. Bonds might be prudent if you are older. ETF composition is made up by the ETF managers and constantly adjusted based on the market. No, you have no control over what comprises the ETF. No idea about Canadian banks Any broker will be able to buy an ETF
VTI, VXUS, VCLT. The path to prosperity.
Why just learn when you can do it yourself! VCLT has derivatives contracts. Mar-17 Puts at $55 strike actually only have a premium of $0.20/contract. God speed my fellow regard. May the death of corporate America lead you to riches.
VCLT has entered the chat
If I was your advisor, I'd say buy VCLT-Vanguard Long-Term Corporate Bond ETF. But I'm not your advisor 😎
Well, it's true that they can't predict if the kid will survive till 35, and even if the kid won't set up their own account and then get a nasty letter from the IRS. So yeah, I agree that just sitting on that money until a certain age isn't all that helpful, much better to ask directly if the kid wants a help with a house downpayment or something. Coincidentally, though, I did gain a lower six-figure in a year, didn't take that long to figure out what to do with it, the good old VTI-VXUS-VCLT is the simplest solution unless you have debt at the age of early thirties, and can be found within about an hour of googling.
If I was just putting it in automatically and looking again in 20 years. No individual businesses just etfs. VT 40% FSTA 25% SCHD 20% VOO 10% VCLT 5%
As soon as I get paid, I’m getting into bondage. Hard. Loading up on ANGL, but tempted by SPHY, JNK, or VCLT. I am trusting I don’t get choked out, BND is olde faithful but yield is less than series EE so I’m passing on the classic until it starts printing more than 3.6%.
Buy VOO, VTI, VCLT, and VYM. Just lie I did today and the day before.
It’s really hard to answer that because their are so many considerations such as duration and government or corporate. A corporate bond fund I am familiar with is VCLT.
fucking r/stocks man "I want to develop a diversified, but aggressive retirement portfolio. I appreciate any opinions. IVV 30% VTWO 10% VXUS 21% VWO 8% NLY 1.5% REG 1.5% OIH 1.5% IXC 1.5% VCLT 12.5% XMPT 12.5%" that's what they call aggressive? fuck off with this shit
Decent diversification in international b/w the 21% VXUS and 8% VWO - if this was my portfolio I'd shoot for 25% total allocation leaning more heavily on VWO for an aggressive portfolio (note: I'm a bit biased toward US equities). Also, I'd personally slightly lower overall VCLT/XMPT percentages (maybe down from 12.5 to like 7.5?) in favor of higher S&P allocations or additional individual holdings. Also, generally curious why you went with iShares S&P but everything else Vanguard :D
I'm sitting on 40% cash but contemplating putting the majority of that into VCLT.
$10k in I-bonds in 2021 and 2022 for a total of $20k(10%) in I-bonds, to protect against inflation OR a downturn. 50%($80k) in SPHD to get monthly dividends from stocks 20% VCIT/20% VCLT to get monthly dividends from bonds.
>Bonds don't crash unless the issuer goes bankrupt. Depends on your definition of crash: - TLT, a long term treasury ETF, dropped by 20% in 2020 due to fears over rising rates. - Vanguard's long term corporate bond fund, VCLT, dropped by about 30% during the covid pandemic due to fears of default. > Bonds don't crash unless the issuer goes bankrupt. If interest rates rise, the short term bonds lose value faster than the longer term ones That is incorrect, you have it mixed up. Long term bonds lose value when interest rates rise because they are exposed to lower rates for a longer period of time.
Since you asks which ones everytime lol I'll share instead of downvoting you. If I did it on impulse I'd easily be at 40-50. With some effort I can cut it to the 20s pretty easy but cutting any further was really hard for me. The ETFs made it easier because I can just own a lot of things with a good etf instead. In no particular order. Pltr Vici Nxgwf Baba Brkb FSTA SPEM FUTY XLC SCHD VCLT
Don't write off bonds. It would be malpractice for you to not buy bonds in this situation. If it is obvious to everyone that rates will hike? It's priced in. If you think the market's pricing it wrong, and the Fed will hike rates sooner and larger than expected? You only expect prices to change to reflect the delta between your expectations and the market's expectations. If that delta is huge you need to really question your assumptions. Also, don't forget TIPS exists. The 50% in medical expenses - that number will always go up, unfortunately. This needs to be an ultra-safe portfolio. I would not expect more than 10% equity exposure. Anyway, would be interesting if you checked back in a few years and see how the recommendations in this thread held out. You're getting a lot of recommendations here and I wonder how it'll all pan out. [Throw this one](https://www.portfoliovisualizer.com/backtest-portfolio?s=y&timePeriod=4&startYear=1985&firstMonth=1&endYear=2021&lastMonth=12&calendarAligned=true&includeYTD=false&initialAmount=10000&annualOperation=0&annualAdjustment=0&inflationAdjusted=true&annualPercentage=0.0&frequency=4&rebalanceType=5&absoluteDeviation=5.0&relativeDeviation=25.0&leverageType=0&leverageRatio=0.0&debtAmount=0&debtInterest=0.0&maintenanceMargin=25.0&leveragedBenchmark=false&reinvestDividends=true&showYield=true&showFactors=false&factorModel=3&portfolioNames=false&portfolioName1=Portfolio+1&portfolioName2=Portfolio+2&portfolioName3=Portfolio+3&symbol1=CASHX&allocation1_1=10&symbol2=VTIP&allocation2_1=30&symbol3=VCIT&allocation3_1=30&symbol4=VCLT&allocation4_1=10&symbol5=VGLT&allocation5_1=10&symbol6=VT&allocation6_1=10) into the ring for me.
Background: started investing Jan of 2020 into a Vanguard Roth IRA after graduating college. Was consistently contributing until some financial hardship. Starting to contribute about $100 a month as a grad student. Think my portfolio is a little wonky and would like it more balanced VEU - 13.3% VUG - 3.3% VDE - 24% (bought insanely low during Covid, looking to redistribute elsewhere) VYM - 20.5% VGT - 10.1% VCLT - 7% (looking for more bond options - possibly more VCLT or BND) VOO - 10.2% VTI - 6.8% VPU - 3.5%
If you're looking for a set-it-and-forget-it, I recommend a 60/30/10 blend of US market/global market/bonds. That would be something like VTI/VXUS/VCLT. If you're looking for an easy diy for investing this way, check out M1 Finance. You can pick a blend (what you want to invest in and what percent of your portfolio for each pick). Then you can schedule direct transfers to M1, and they will auto invest to maintain the blend percentage. You can transfer to the account as frequently as desired, but base M1 trades 1 time per day in the morning.
VCLT has higher yield than VCIT (since it's long term bonds), I think you probably mean VCSH which is shorter term and lower yield? FWIW, I've used both VCSH and VCLT in the past (mostly as a hedge, to book paper losses in my home currency when it strengthens against USD).
I use VCIT. No particular reason other than it seems to have a better yield than VCLT with only marginal more risk. Might be my perception is wrong.
Which corporate bonds do you buy? VCLT?
If you want to loan out your money, it'd be easier and safer to invest in corporate bonds. VCLT is currently yielding 3.08% (hey, at least its higher than 30 year treasuries). OTOH, compared to lending money to a random person on the street, TQQQ and UPRO are far less risky. If you're worried about a crash, look into the HFEA portfolio.
Vanguard Long-Term Corporate Bond ETF (VCLT) is about 3% yield to maturity
If you park money you need in a crisis in a bond fund, make sure you pick the right bond fund. If you choose a long term fund like VGLT or VCLT, then your value can fluctuate +-20% over a year or two depending on interest rates and market conditions. You’d be getting around a 4% yield for this volatility. If you pick short term bonds like BSV or VCSH, your volatility is closer to +-5%, but your yield is only 0.35% right now. I’d rather just keep it in a savings account getting 0.5% and not have to worry about protecting my principle during market fluctuations due to crashes or interest rate hikes
I do expect bonds to be a weak choice for the near to medium term, I don't intend to buy those funds until they decline & offer a higher yield (along with potential price appreciation). Probably VCLT for the highest yield & volatility. To answer your question, I think the spread between short & long term rates is historically quite narrow, & the short term funds won't decline in value as much if/when the fed increases rates, but I still don't see them as worth it for those with a risk appetite who are seeking nice returns. I just brought up bonds & some of the other stuff because you were stating concern about a crisis. I'm not currently concerned about that, but if it happens it happens... my stocks would lose value but I'd be fine. If you're not retired or nearing retirement, it's just not helpful to invest as though there's always a crisis on the horizon.
The monthly payments for an individual bond are fixed regardless of whether the bond's duration is for 1 year or 5 years. A bond is a loan to an entity (government or corporate), where that entity pays the bondholder interest each month for the loan. Instead of buying bonds directly, you could consider bond funds (ETFs or mutual funds). I prefer Vanguard's offerings like BLV, VTEB, or VCLT. Generally, for bond funds, the volatility (e.g., risk) of a fund is proportional to its yield. A higher yield will likely equate to higher volatility in the bonds price.
Decided to check out current returns for Vanguard ETFs. A few that I see are more "ripe" than others: I'll list the ETF (YTD return) (Avg Annual Return Since Inception): EDV - Extended Duration Treasury (-12.5%) (7.58%) BLV - Long Term Bond (-5.59%)(6.94%) VCLT - Long Term Corporate Bond (-3.48%)(7.45%) VONG - Russell 1000 Growth (11.8%)(17.84%) - inception date 2010... VOOG - S&P Growth (12.83%)(17.7%) - inception date 2010... VDC - Consumer Staples (5.67%)(10.16%) VPU - Utilities (3.67%)(9.84%) ​ For reference, here's a couple examples of maybe what NOT to invest in based on the same analysis: VDE - Energy (52.92%)(4.95%) VTI - Total Market (14.96%)(8.71%) MGV - Mega Cap Value Index (15.97%)(8.3%) I'd love to know what others think about this strategy. It makes sense to me, but I'm by know means an expert. I also think it would make sense to reassess on some established frequency.....once per 6 months or something....to reallocate.
31, $270k, 85% VTSAX, 10% TSLA, 5% VCLT.
My 2 cents. Lack post pandemic opening economy opportunity etfs--Retail, inflation protected (energy, natural gas, raw materials). Reduce 1st two %. I even think VOO works better. VCLT replace with high dividend corp bonds or convertible corp bonds for better yields. DBB-->VAW.