Indexor

Long and Junk Bond ETFs: Stepchildren of Fixed Income Investing

Excellent thoughts, probably because I agree with most of your ideas. While I no longer use junk bonds, I do use iShares 1-3 year Treasuries (SHY), Vanguard Total Bond (BND) and SPDR Lehman International Treasury Bond (BWX). 10 years ago I read an interesting white paper by Dimensional Fund Advisors (DFA) that claimed all bond holdings should be placed in 1-year Treasuries with the rest commited to equities. It makes sense from a portfolio protection perspective as well as increasing returns in upward markets. I wonder if that concept still isn't valid today. I'd love to see new research on that topic.