Listen to Bill when he says the bond bull is dead; or suffer the consequence of losing 10-20 times the monthly divvy in principal for the upcoming bond bear.
11.40 was my target on the up side.
9.40 is my target on the down side.
Sentiment: Strong Sell
Oh well.....Dudley at NY Fed says markets wrong to think tighter policy coming soon. 10 year rate ATM is 2.505, half a percent down from a few days ago. BND up .28% ATM, AGG up .22% I think the herd has calmed but it sure was startled and ran mad and hard for a good ways. And it's somewhat thinner now. ;-)
Considering the holdings, I don't think you will get the 9.40 on the downside. I think the bottom for this fund is going to be about 10.40-10.50 this year. The durations are just not long enough.
I am a boomer retiree and fully agree with Fexiblehorse62... you guys want to try and time this bond market it is your business. As for me.. been in this fund for 10 years and always ride the wave. Even if I had gotten out at the top .. by luck and bought back in today I would have gotten an extra 1100 shares or so producing 36 bucks or so a month income. Why would I take the chance? Long term stay with what you have add to it along the way if possible. equities market is not for me anymore too much volatility and this ecomomy is going to be slow growth for a very long time as it is the new normal IMHO. Bottom line rates go up DIvidends follow. BTW no haircut today.. hmm
Sentiment: Strong Buy
When I hear some people say “I am riding it down” or “I may miss opportunity and this will recover eventually”. Yes, but this is not an unpredictable stock.
If it was a stock then it won’t be predictable since it may jump back up at any moment. However, this is a bond fund and very predictable for a period. Interest rate is going up one way or another (actually, there is no choice but going up). So, this bond is heading down and losing another 6.5% before it settles down. The nav may not recover for a few years. The dividend payout is 2.5% per year or it takes 2.5 years for dividend income to compensate for loss of nav.
Thus, if an investor exited at $11.20 or even now and waited until December 2013 then he/she could go back in and ride it up plus collecting dividend and compensate for those months he/she did not collect any dividend.
I applaud your wisdom to watch the signs & react properly........but unless this amount is half of your investments not sure why you would have that much in PTTRX. My down side target is below the 08/09 plunge.
Sentiment: Strong Sell
One more comment: I am the first wave of 30+ million baby boomers. All of us were burnt by stocks in '08 (GE is only half of what it once was and it's dividend is less than half. CSCO is 1/4 of what it once was.) PTTRX fell to 9.70 then, about a 11% loss. All of us have to generate income to live off of. The administrators of our pension plans (those who have one) have to generate income to fund them. There are very few "safe" options available (look at gold which has lost almost 25%). Buying an annuity at historically low rates is not an option. Result is that wave after wave of Boomers coming after me are in the same situation: how to generate income to live off of. PTTRX, PTLDX, PIMIX, PAAIX, VWINX, MWTRX and a number of others aren't going anywhere. I am not alone in having to live off of what I have saved without spending a lot of it. Because I am in the first wave of Boomers I feel pretty comfortable they will also buy PTTRX which will help support it. With a longer horizon its price will adjust as bonds mature; in the interim I have uninterrupted income from it. As those who come behind me.
Are you retired? If you are then I assume you are spending capital to live rather than living off of dividends that you have now sold.
So what did you buy with your money? If you didn't buy anything how long do you plan on staying in cash? You also realize you are trying to "time" the bond market and are not collecting a cent in dividends while sitting on the sidelines?
Too many people on here don't understand that if someone is retired there is an entirely different perspective on "sitting in cash." There is no sitting in cash. When you do this you live on what you've saved because there is no income.
At a certain age it is not as simple as sitting on the sidelines. One way or the other money is spent to live. Pulling out of PTTRX only guarantees you are going to spend your savings. If you sit out for a long time you can spend a lot of what you've saved. Maybe more than you fear losing IF PTTRX continues to drop.
I also don't understand people playing bond funds like stocks trying to time going in and out.
I bought some 'T' on the last pullback @ $34.20. T currently pays (as of this moment) an annual dividend of 5.2%, not too shabby, wouldn't you agree? I keep T in my 401k retirement account to avoid the annual cap gains tax.