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Subject:  Re: Building a Treasury Ladder Date:  8/22/2004  1:37 AM
Author:  Sonnet Number:  9349 of 20630

I am wondering if in this interest rate-raising environment it would be better for me to rebuild the ladder with short-term (1 or 2 years) rungs. At least until it looks like the Fed is likely done with raising interest rates.

I think this is the reason for building a ladder in the first place. We just don't know when or how much rates will rise and we don't want to lose income in the mean time.

As to the first reply no it's not 10 or 20 k more like 500k so if I did build it with 10 yearly maturities it would be 50k each, if I did it with 5 it would be 100k each. Guess it really doesnt make that much difference other then as was stated less maintinance with 5. As far as diversification goes there is no risk of default so that is not an issue.

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