Put in about 50k in bonds earlier this year for a short time horizon investment. I believe I generally understand how bonds work but obviously I dont understand it fully and so I am here...
I know federal interest rates are rising which makes my current bond holdings relatively less valuable since they return lower rates than new bonds. So I am seeing that reflected in the value of my holding (VBTLX) which is slowly decreasing.
Now I know my returns will mitigate some of that cost and allow me to 'buy in' on the newer bonds... But given the interest rate hikes, shouldnt I be concerned that the intrinsic value of my holdings will suffer when I need to withdraw this money in the near future? Should I hold cash instead?
Tldr: confused on bond market, send help
Submitted May 16, 2018 at 09:23AM by telekaster57 https://ift.tt/2Gohzmp
