Is It Time To Buy Long Term Bond Funds Before Fed Cut Or Is It Too Late?? TLT & EDV Explained

Long term bond ETFs like TLT and EDV have a large potential upside due to effective duration. Huge amounts of money are pouring into long term bond funds in anticipation of the next Fed rate cut. Is it time to buy now or is it too late?

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-All of the content found in this video is for ENTERTAINMENT purposes only. We are NOT financial advisors and are not responsible for any losses in your personal investing experience.

[brucesmith]

Timely video. I have been mulling over whether to buy some Treasury Notes and bonds as a hedge. Note the emphasis on the word _some_ .

[HectorYague]

Hmmm... some incorrect information in this video...

1) 5:12: How Durarion affects bond prices: it is not changes in the Feds Funds rates as described in the video but changes in the Yield To Maturity instead, which is a completely different thing specially for TLT and EDV as they track the very end of the rate curve.

2) 8:16: The long end of the curve does not respond to changes in the Feds Funds but changes in long term inflation expectations instead. The Fed could cut the Feds Funds (which would drop the short end of the curve), yet the long end could easily raise in a bull steepener fashion if the market believes that said cuts might bring inflation back up.

[LEX-mzje]

Given the persisting global economic crisis, it's essential for individuals to focus on diversifying their income streams independent of governmental reliance. This involves exploring options such as stocks, gold, silver, and digital currencies. Despite the adversity in the economy, now is an opportune moment to contemplate these investment avenues.

[bellgrand]

It's not just interest rate cuts that TLT/EDV hedge against. They also benefit if economic weakness prompts a flight to safety in the form of bonds.

[bobbobertson]

Excellent thorough analysis including possible risks. I concur this isnt a 10 year hold IMO mor like 6 to 18 months give or take

[georgelien]

I bought 700 shares of TLT in April-May for less than $88. Could have sold them in August for more than 10% profit (9x/88), but I didn’t sell them (yet)

[vincent-jete]

Helpful presentation. Thank you. Always appreciate referencing and interpreting other sources, like Seeking Alpha article.

[uropy]

Long term wise equity index beats bond by arms and legs. The only time you can consider buying bond is when you need a stable investment/cashflow. Even then you should buy cash bond, not bond fund/etf, because bond fund does duration rebalancing which exposes you to interest rate always. Cash bond will return you principal in the end (non rebalancing) but not bond fund

[steveb]

The bond vigilanties are dead and even if they do demand higher yields due to higher supply, the fed will print and buy. Yield Curve Control and MMT are going to drive bond yields lower.

[none-dg]

Hello why is the long treasury bonds 20 TLT Went way down on this week after J Powell cut rates ??

[LewisLudwig]

What about buying 20 year zero coupon treasuries? Those will go up and down more than treasuries that pay a coupon. Can't resist those right now, but not going to remortgage my house. I'm going to put in about 3% of my stash in those.

[finanzen]

What webpage or software were you using in this video to look at the information of Average duration etc.?

[freeroamer]

Great information. Am looking forward to your take on corporate bond etf's! 👍

[blairmyers]

Thanks for the info, really appreciate it!

[lohti]

I think 30Y yield will drop back to the normal 3.0% or lower when fed cut rate to about 2% ..

[woodsonjane]

Good points, thank you for your insights!

[jazz]

TLT went down after the Fed reduced the rate. So this was not correct. Why do you think that is?

[william]

How is EDV taxed in a taxable account? Do I have to pay imputed interest quarterly before I even sell it?

[vincent-jete]

can you review Vanguard Cash Plus Account, Thanks

[mashiniwami]

Long-dated is a sucker's bet. Returns will not beat inflation, especially if you have the privilege of paying tax on the interest income. Repression is coming. What to do?