RetireJapan

Hey all,

I've got a question. I don't really understand bonds in terms of if or how they overlap with each other. I remember asking on here about ETFs, and someone shared a great website that shows you if different ETFs overlap or not. So I was wondering if there is a website that does the same thing for bonds.

Also, should people have multiple bonds, or just stick to one (or maybe 2)?

For example, I have GVI, LQD, BLV, and TLT. Would this be considered overkill? I was wondering if I should get rid if one or two of them to simplify things. What do you all think? Disclaimer. About 20 percent of my portfolio is in bonds.

Many thanks in advance.

There are two main categories of bonds, Governmental/Sovereign and Corporate.

American Governmental Bonds

When it comes to American bonds, there are a few different options.

Are you American? If so you can buy Series I and EE bonds direct from the US treasury. These cannot be purchased any other way.

Beyond those special bonds, there are few more categories.

https://thismatter.com/money/bonds/type ... rities.htm

The differences have to do with the duration of the bonds, which affects the yield.

....

Corporate bonds offer higher yields typically, but with more risk. Their risk is rated from AAA-BBB. Anything below BBB is a Junk Bond. That is a category, not a slight.

They are not strictly necessary to hold in any portfolio as they do not have an inverse relationship with stocks.

....

All of these types of bonds can be held in funds, at different durations, yields and varieties.

If you are holding Bonds as ballast, or safety net you want to make sure they are high-quality government bonds, and maybe high-quality corporate bonds. The shorter the duration, the safer, however, this will lead to less yield

....


Those ETFs you listed are not optimal in Japan, and you lose a lot on currency conversion and triple-taxation.

Look at these instead.

Emaxis Slim Advanced Government Bonds /
ｅＭＡＸＩＳ Ｓｌｉｍ 先進国債券インデックス

https://www.rakuten-sec.co.jp/web/fund/ ... 90C000END3

Rakuten Total Bond Index
楽天・全世界債券インデックス（為替ヘッジ）ファンド
https://www.rakuten-sec.co.jp/web/fund/ ... 90C000HBG4

Thanks for the reply. Actually I have them through Robinhood since I am an American.

jeronimoski wrote: ↑Wed Dec 23, 2020 8:29 am Thanks for the reply. Actually I have them through Robinhood since I am an American.

If you are an American ignore the Japanese funds.

Vanguard BNDW is your one-stop shop for bond funds.

If you want more specific info, check here.

https://www.bogleheads.org/forum/index.php

The market for bonds is vastly bigger than that for stocks and there are so many ways to delve into this. Depending how deep you want to get into it will help identify the number of purchases you make.

BNDW is interesting. It’s a bond ETF made up of 2 other bond ETFs. Quite heavy on international bond exposure. I’d not seen this one before and glad for the exposure.

AGG is another bond ETF that it’s expansive and provides a diverse slice of the bond market. It’s US focused and has a bit more exposure to corp bonds (which are being somewhat backstopped by the Fed).

Either could be a single holding of your bond allocation depending on what kind of allocation you’d like. Short term, it’s hard to get excited about gov’t issued bonds with everyone printing money at very low rates.

Ax6isB wrote: ↑Tue Jan 12, 2021 6:00 am The market for bonds is vastly bigger than that for stocks and there are so many ways to delve into this. Depending how deep you want to get into it will help identify the number of purchases you make.

BNDW is interesting. It’s a bond ETF made up of 2 other bond ETFs. Quite heavy on international bond exposure. I’d not seen this one before and glad for the exposure.

AGG is another bond ETF that it’s expansive and provides a diverse slice of the bond market. It’s US focused and has a bit more exposure to corp bonds (which are being somewhat backstopped by the Fed).

Either could be a single holding of your bond allocation depending on what kind of allocation you’d like. Short term, it’s hard to get excited about gov’t issued bonds with everyone printing money at very low rates.

I would probably pick Vanguard BND over Blackrock AGG. Same index, but cheaper.

Vanguard is also a very solid and reliable company.

OkLah! wrote: ↑Tue Jan 12, 2021 6:27 am Well there is a bit of everything. Austria issued a 100yrs bond at 2.1% in 2017. This bond is now trading at 220% (issued at 100%).

This is mind boggling. And the trade’s probably going to get better this year. Hope you own some!