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URL:  http://boards.fool.com/rus-on-the-assumption-the-intermediate-bond-28984323.aspx

Subject:  Re: Poll: Did your 401k recover from the 2008 de Date:  12/27/2010  10:38 AM
Author:  TwoCybers Number:  67946 of 75381

Rus on the assumption the intermediate bond holdings have an average maturity in years (i.e. more than 1 year); your holdings are in mutual funds and finally the fund is forced to sell bonds at some point before maturity - I say think twice. Just look at what will happen to a 2 year from maturity instrument when rates rise to 3%.

If you were 70% equities, I urge you to get back there. Maybe you want to get into dividend paying equities, but bonds generally and particularly bond funds in my view will be money loosing over the next 3 to 5 years.

I have bonds, but I hold bonds that will be held to maturity -- thereby eliminating the interest risk.

Gordon
Atlanta
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