My understanding: TIPS valuations are very susceptible to interest rate moves, not a direct function of inflation moves. Of course, the Fed largely adjusts interest rates to control inflation, so there is likely a strong correlation. TIPS are likely more susceptible than nominals. And like you stated, it is not an issue if you hold to maturity, which is why I think we agree that you shouldn't buy TIPS unless you are reasonably certain you can hold to maturity.TIPS would lose value the longer out the duration. You’ll be made right when they mature. It’s really a question of how far out in the curve you want to buy if you’re not building a ladder.
Statistics: Posted by protagonist — Fri Dec 06, 2024 9:34 am