3 thoughts on “Life’s guarantees

  1. Some are using instead of bonds, because of the inflation fear. Substituting for bonds, as a fixed income portion of portfolio.

    Any opinions?

    • I substituting GICs for the bonds portion of a portfolio isn’t an ideal strategy. It’s true that bonds and inflation are inversely correlated but the relationship is not linear. I would favor using bond ETFs instead of individual bonds. Maybe have a minor % of the portfolio in GIC. Also it would depend on the investors risk tolerance. What do you think?

      • I agree. I do not want to tie up my $$$ for 1-5 years, for such low return. If interest rates rise, you still lose the opportunity cost of your investment.
        I am currently using an ETF, as you have suggested, but using a laddered version. If interest rates do rise, I will passively get some of the higher rate bonds, with the ladder Am trying to avoid ETF’s with large positions in long bonds.
        Anyway, interesting stuff!!!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s