I bonds now a good buy?

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dyangu
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Joined: Wed Nov 03, 2010 4:25 pm

I bonds now a good buy?

Post by dyangu » Sat Aug 10, 2019 10:37 am

For those who haven’t maxed out their I bonds this year yet, it seems like it would be good to by before Nov. Current fixed rate is 0.5%, 5 year TIPS is at 0.15 so the Nov fixed rate will probably be lower?

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John151
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Re: I bonds now a good buy?

Post by John151 » Mon Aug 12, 2019 2:24 pm

I can’t accurately predict what the fixed rates will be, so I buy half of my I Bonds in May and the other half in November. That said, the fixed rates are so low that it doesn’t much matter when you buy.

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Rob5TCP
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Re: I bonds now a good buy?

Post by Rob5TCP » Mon Aug 12, 2019 3:32 pm

Historically rates have been much higher, but this is the best we have
over the past 10-11 years.

I DON'T see rates going higher in November, if anything they will
probably go lower.

Anything can happen, but it seems unlikely in this environment.
If your concerned buy them a few weeks before the new rates
take affect.

ivk5
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Re: I bonds now a good buy?

Post by ivk5 » Mon Aug 12, 2019 3:50 pm

+1 on waiting a couple months to see what TIPS yields are doing as Nov gets closer.

I don’t believe in buying I Bonds in months other than Apr and Oct (information advantage) and Nov/Dec (calendar year quota). Described my approach here: viewtopic.php?t=276393#p4449564

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nedsaid
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Re: I bonds now a good buy?

Post by nedsaid » Mon Aug 12, 2019 8:44 pm

Yes, this would be a good time to buy I-Bonds.
A fool and his money are good for business.

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willthrill81
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Re: I bonds now a good buy?

Post by willthrill81 » Mon Aug 12, 2019 10:11 pm

Considering that the break-even inflation rate is only about 1.6-1.8% on TIPS, depending on the maturity, I bonds paying an additional ~30 basis points or more seem like a no-brainer for fixed income.
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Day9
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Re: I bonds now a good buy?

Post by Day9 » Mon Aug 12, 2019 11:03 pm

Would it be very difficult to buy the maximum amount of I Bonds ($10k per person per year) and then adjust the rest of your fixed income portfolio so you are still exposed to the same amount of duration and credit risk? For example you can buy the I Bonds then extend the duration of the rest of your bonds so that your overall bond portfolio duration is constant.
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