I'm referring to research done at Vanguard and other places saying that active management of bond mutual funds does not add value (references available on request; I'd have to dig it up). You'd think that it would since it should be possible to do research to predict which bonds are likelier to default than the market thinks. But most bond mutual funds make the wrong interest rate bets time and time again.There are not two instances of interest rate possibilities, but three. Rates can go up, go down, or stay the same at any point along the yield curve. If you guess rates are going up, there are two ways you could be wrong: they could go down, or they could stay the same. That's what I was referring to with my original reply.But I agree 100% with your advice. It's essential to have a plan for what to do if your predictions don't pan out.