Anyone locking is some good rates for long term bonds?
 

As interest rates have been on the rise lately, has anyone been socking away money into long term bonds that are paying 8% interest. Having that kind of return with no risk is a nice piece of mind, especially for young players who want to start something like a ROTH IRA. The big downside is missing other investmant opputunitues, especially because if you put it in an IRA, you cant touch it until you're 60.

Re: Anyone locking is some good rates for long term bonds?
 

You don't want to be sticking money in bonds when intrest rates are rising because bonds are going to lose value as soon as rates go up. I took a look at http://bonds.yahoo.com/rates.html and while it doesn't display BBB or BB ratings and I don't want to spend lots of time looking when I don't think you can find an 8% yield on an investment grade bond. Also, you talked about not having any risk is wrong unless your talking about T-Bills everything else does carry default risk, which is shown in a bond's rating.

Re: Anyone locking is some good rates for long term bonds?
 

when interest rates are rising. and you dont know exactly how much or when, a money market fund tends to beat all other investments. bonds do poorly and stocks as well. although the stocks may have a lag which makes it look like they arent going to be effected much, and then whammy.

Re: Anyone locking is some good rates for long term bonds?
 

no such thing as returns with no risk. and right now there is especially no such thing as a 8% yield with no risk. 8% yield gets you into junk bond territory right now.

Re: Anyone locking is some good rates for long term bonds?
 

Being in an IRA doesn't matter in terms of investment opportunity. You face a penalty for taking it out to spend, but you can re-allocate the investment to whatever you want.

natedogg

Re: Anyone locking is some good rates for long term bonds?
 

[ QUOTE ]
Being in an IRA doesn't matter in terms of investment opportunity. You face a penalty for taking it out to spend, but you can re-allocate the investment to whatever you want.

natedogg

[/ QUOTE ]

Yes i know, i only meant that while it's tempting to being to save money in a Roth IRA to generate a tax free retirement income, the downside is this would not allow for early reitrement because the money can't be used.

Re: Anyone locking is some good rates for long term bonds?
 

for the short-term until I figure out where I'm going to buy a house..I bought some 2-year Treasury notes yielding 3.80% about 2 weeks ago ..yield is down to 3.63% this afternoon.I also own some 5.73% Federal Home LoanBank Bonds due in 2013..they are callable thu so they never trade much above par.But I get semi-annual payments on that 02/20 and 08/20 of each year.For 8% you are going to have to go down in quality.If you want 8% long-term for an IRA just invest in low-fee stock index funds you should get a return of ~7-8% per anum.I also bought some SPY last month around this level(117.60)I also left 4 GTC SPY buy orders laddered down 2.50% from one another.If I get hit on all of them.I own about 1000 SPY's..next order down is @114.75--looks like that ones gonna get hit soon the way this market is acting [img]/images/graemlins/confused.gif[/img]I also max out my monthly contibutions to my Vanguard Roth IRA-VTSMX Fund .I actually dont mind if the market goes lower for my IRA it'll bring me cost basis down for an investment I'm going to hold for 20-30 years...