I agree with Chris but stated in another way --It depends to an extent on what other investments you have and what other accounts you have to put the investments. It may also depend on whether you are in the accumulation phase or in the withdrawal phase.Generally you should looks at your investments and rank them in order of tax efficiency and place the most tax inefficient items in your tax deferred accounts and the most tax efficient ones in the taxable accounts. In the middle are non taxable accounts or Roth IRAs.A tax inefficient investment is one that has distributions that would be taxed at ordinary income tax rates. These would include most bond funds. Tax efficient investments are those that produce distributions at tax favored rates. These would include equities and equity funds especially broad based index funds since the distributions are usually long term capital gains and qualified dividends.Without knowing more about your portfolio it is difficult to say specifically, but, in general a GNMA fund is more appropriate to a tax deferred account.If you are in the withdrawal phase and are spending the distributions it makes this less of an issue since withdrawals from a tax deferred account will be taxable at ordinary income tax rates anyway.Bob
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