The GNMA is offered at par. You aren't going to get any capital gains on that, either, if you hold to maturity. If you don't, there might be capital gains or capital loss, depending on market fluctuations. Are interest rates going up or down over the next 30 years? Yes. Is 5.5%, guaranteed by the government as to timely payment of interest and principal, and fully taxable, a great rate? I don't think so. Plus there is the risk of early repayments. If interest rates go down, there will be early repayments. If they go up, you're stuck with a 5.5% investment for the better part of 30 years. And a whole brand new GNMA costs $25000. Best wishes, Chris
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