JasonC

Stocks vs. Bonds: An Update for the Current Market

The current yield on the SP500 is more like 3%, not 10%.

As for how to buy bonds, you can get a pro to manage a bond portfolio for you by investing in an open end mutual fund like Loomis Sayles. Many bond managers have fled risk into treasuries or agencies in the recent slide, not where you want to be. Instead the sweet spot is A rated or BBB rated corporates, and LS is a well managed fund aiming there.

That is the easy way. A harder way is to use some closed end funds trading at discounts sufficient to cover their generally higher management fees. Loan participation funds, high yield (junk) funds, distressed mortgage funds, and preferred stocks, are all ways to play the same spreads - but each is quite risky, and I'd only recommend 5% of a position in any one of them. With the bulk in something broader based and investment grade, like LS or Pimco.