you are viewing a single comment's thread.view the rest of the posts
Here's my strategy . I'm about 60% bonds 15% cash since the run up after 2008. I'm waiting for the next big market pullback, in 2008 I bought stocks that I would have had to hold for 20 years to see that kind of return. Fiscal cliff, Euro, investors continue to leave equities and are running this bond fund up, I know its going to sink when interest rates rise and I'm not going to try and time the market I'm looking for a 15% pullback to start moving out of PTTRX and into equities. Rule of thumb your % of bond investments = age, at 54 I'm not going to leave BOND all together just taking some of the gains. On the down side if there isn't a pullback in the stock market I get to keep my money the downside risk is better than equities. My $.002 worth.
New York CNN Money:
U.S. stocks are expected to grind higher in 2013, but don't expect another year of double-digit gains.
According to more than 30 investment strategists and money managers surveyed by CNNMoney, the S&P 500 should finish 2013 at 1,490, up 4.5% for the year. While that's not anything to scoff at, it's a far cry from last year's 13% increase.
4.5% I think BOND can beat that without the downside risk. JMHO
What all these strategists have in common is they have no more way of predicting what equities will do over a year, or even a month, than anyone else. In fact, a lot of these people were expecting 2012 to be a bad one for bond fund owners--glad I didn't listen to them.
Gross can protect his portfolio to a degree but rate hikes coming off these unreal low levels will leave little place to hide. Many can recall when Greenspan came off a low and soon was hiking rates every time you turned around. It was a savage time for bond funds, and equities, too. Bernanke hopes to keep rates this low through 2013 (cross our fingers) but once he opens the flood gate, no matter how he tries to contain it, bond funds are going to get hurt bad. But if I have my money with anyone in the bond arena, it will be Bill Gross. I'm still a buyer here.
I'm close to 60% bonds but until now I've done almost all corporates BBB+ to AA that I've chosen myself. I have a few GSE bonds as well but no bond funds. But now, I have to literally go out 30 years to get 3.5% on a Shell or Pepsi or something of equivalent quality. I feel like a classic schizophrenic trying to chase yield without being pushed to far up the risk curve at the same time. What I'm hoping for from a Bill Gross is that kind of magic that can sidestep the downward pressure in price if in fact I held the fund into 2014 or 2015 and interest rates move up a percent. My alternative is foreign equities with decent dividends, reasonably stable currencies and no foreign withholding.
the problem is that there are no good places to get yield and safety and sooner or later when bonds start to rise, this and other bond funds will drop; the fed is almost pushing you into stocks, so dividend stocks seem like a somewhat safer bet to be in sometime during the year - i think the economy is stronger than people realize even with very high unemployment and it is only a matter of time before the markets turn on bonds; look at tbt went up huge yesterday and i think it will continue to go up, the 30 year gains in bonds are almost over