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Investing - Theory, News & General • Why not 100% PSLDX? [PIMCO StocksPLUS Long Duration Fund]

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So an earlier post says this fund has -100% CASHX position. I interpret that to mean it shorts short term treasuries, which are doing well considering an inverted yield curve.

Since long term treasuries return less than short term treasuries, is the only way this fund can beat the S&P 500 is for long term interest rates to fall while you’re holding the fund?
No. Another way is that short-term rates fall, which is currently expected by the market as expressed by the forward rates.

The long-term bonds will ride down the yield curve (if all goes well).
So we know rates won't go to zero anymore, the consensus is that they'll fall a bit from current levels and leave them alone. Aren't long term rates currently pricing in cuts (hence they currently have a lower rate than short term rates)? It seems the only way long term rates fall is if short term rates fall a lot more than anticipated?

Statistics: Posted by tcrez — Fri Apr 12, 2024 5:06 pm — Replies 2125 — Views 401331



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