Funds: "A Minefield without a Map"


Q: If you wanted to tiptoe into bond funds for the first time, where should a senior-age person begin?

A: At this point in the market, I would be looking for a relatively short-term bond fund, because interest rates are more likely to rise than to fall, and as interest rates rise, the principal value of the bonds falls. You want to be in shorter-maturity bonds to limit your exposure to the loss of principal. PIMCO has a good low-duration bond fund.


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