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Comparing Individual Bonds and Bond Funds
The chapter explores the advantages of holding individual bonds over bond funds, focusing on the benefits of capital gains tax treatment and known returns until maturity. It discusses the potential drawbacks of bond funds in transitioning yield environments and argues that both individual bonds and bond funds face similar losses in specific scenarios. The conversation also delves into managing a rolling bond ladder versus investing in passive bond funds, highlighting the trade-offs between active management for extra returns and the simplicity of fixed duration funds.