On Sep 18, 2:15 pm, big_rag...[at]webtv.net (Marty) wrote:
- quote -

Total Bond already includes GNMA and Treasuries. TIPS is probably the
only real option to add. Maybe high-credit foreign bonds if you need
some currency hedge due to overseas spending.

big_ragu50[at]webtv.net (Marty) writes:

- quote -

Assuming you mean, say, the Vanguard Total Bond Market fund,
you are pretty fully diversified in bonds.
It's about 24% treasuries and 36% mortgage pass-thrus (though
mostly FNMA, not GNMA, but they're very closely correlated).
Adding more or both of GNMAs or treasuries doesn't constitute
futher diversification at this point, but, rather, conscious
overweighting of an asset class within fixed-income.

If your focus is asset allocation, the question of whether
or not it's the right time to increase your bond allocation
is really more of a question of how far you are from your
target allocation - if you're very far from it, it's time
to get closer, but that's a matter for your asset allocation
plan more than a measure of market conditions.


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Hi group

I am 51 years old & attempting to get my AA to 65/35.I just added the
TIPS fund to my bond portfolio which only consisted of the total bond
market.What other funds could I add to achieve more diversification in
this environment? My thoughts are either/both GNMA and/or medium term
treasury.Is this the right time to add these type of funds? Is GNMA the
wrong fund to get in right now because of the mortgage crisis? Thanks.

~Marty~