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Author: icstars Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35367  
Subject: Bonds not going right direction? Date: 10/11/2009 4:23 PM
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I have a really basic question...
I thought I understood bonds until I compared the 10 year treasury and the fidelity total bond market fund (FTBFX).
I expected that when interest rates fell, the bond fund would go up. When interest rates were somewhat stable,they should be stable.
But, there are excursions in the bond fund that don't relate. For example,

in Sept 9 - Nov 19 Interest rate on the 10 year treasury was mostly the same (about 3.6% ) but the total bond fund dropped 10 %.
Then when interest rated dropped 30% from Nov 19 2008 to Dec 18 2008, interest rates dropped and the total bond fund was mostly unmoved.
What gives?? Any help would be appreciated.
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