How To Invest in Bonds in 2024 (from T-Bills to High Yield) | Summary and Q&A

TL;DR

Bonds are providing some returns after 15 years of negative returns, but real returns after inflation are still at zero. US treasuries are a good option for short-term investments with a high yield. Warren Buffett has a significant portion of his portfolio in short-term treasuries, indicating his preference for lower-risk investments.

Key Insights

• ↩️ Bonds are now providing returns after 15 years of negative returns, but real returns after inflation are still at zero.
• ✋ US treasuries offer a high yield, making them attractive for short-term investments.
• 😘 Warren Buffett has a significant portion of his portfolio in short-term treasuries, indicating his preference for lower-risk investments.
• 🥺 Longer-term bonds offer opportunities for speculators if interest rates decline, leading to positive returns.
• 🍉 However, the risk of inflation and government actions impacting returns over the long term should be considered.
• 🍉 Bonds should be used for short-term investments or as a temporary park for money, rather than as a long-term wealth-building option.
• 🍉 Investing in stocks, such as the S&P 500, may provide better long-term returns compared to bonds.

Transcript

good day fellow investors in the asset classes overview for 2024 thank you for the 27,000 views a lot of you asked me to dig deeper into bonds and thank you for the comments and that's what I spend my weekend on to really check all the bond investing options out there to give you the right risk and reward so that you can see how various bonds from ... Read More

Questions & Answers

Q: What is the current state of returns for bonds after 15 years of negative returns?

Bonds are now providing returns, but real returns after inflation remain at zero.

Q: What is the appeal of US treasuries for investors like Warren Buffett?

US treasuries offer a high yield, making them a good option for short-term investments. Warren Buffett has a significant portion of his portfolio in these treasuries.

Q: Why doesn't Warren Buffett invest in longer-term bonds?

Warren Buffett is concerned about the consequences of the government borrowing at will, leading to inflation. He prefers short-term treasuries that offer stability and flexibility.

Q: Are longer-term bonds a good investment option for speculators?

Longer-term bonds offer opportunities for speculators, especially if interest rates decline, leading to positive returns. However, the risk of inflation and government actions impacting returns over the long term should be considered.

Summary & Key Takeaways

• Bonds have started providing returns after 15 years of negative returns, although real returns after inflation are still at zero.

• US treasuries offer a good option for short-term investments with a high yield, making them appealing to investors like Warren Buffett.

• Warren Buffett has a significant portion of his portfolio in short-term treasuries, highlighting his preference for lower-risk investments.