The Meb Faber Show - Better Investing
MEBISODE: T-Bills and Chill…Most of the Time | #529
Apr 12, 2024
This podcast episode explores bond investing beyond T-Bills, analyzing various bond options and strategies, including the correlation between bond prices and values. It discusses investment simulation, asset allocation, and a tactical approach to fixed income investing for improved returns and lower volatility.
15:58
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Quick takeaways
- Fixed income investors can benefit from higher yields by exploring various bond options beyond US treasuries.
- A tactical approach to fixed income investing involves strategically rotating between bond assets based on yield spreads to enhance returns while managing risks.
Deep dives
Fixed Income Investors Rejoice in Yield Opportunities
Fixed income investors are currently enjoying higher yields from short-term and long-term treasuries, marking a significant change from the era of low or even negative yielding bonds. This shift has sparked optimism among retirees and fixed income investors, leading them to explore various bond options beyond US government bonds, such as corporate bonds, junk bonds, mortgage-backed bonds, tips, foreign bonds, and even Bowie bonds. Investors typically choose between safer investments like treasuries and diversified strategies like the Bloomberg US aggregate bond index, adjusting their risk exposure based on factors like term premium and credit premium.
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