Here’s Why An I Bond With A Fixed Rate Of 0.0% May Outperform Your Short-Term TIPS Fund

Summary

  • Short-term TIPS have real yields negative to inflation.
  • An I Bond with a fixed rate of 0.0% will match inflation and provide a better return than a short-term TIPS.
  • For a short-term TIPS fund to outperform, real yields will have to fall deeper into the negative range, which seems unlikely.

I suggesting that you take a look at an alternative to short-term TIPS funds: U.S. Series I Savings Bonds.

Read my full analysis on SeekingAlpha.com

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About Tipswatch

Author of Tipswatch.com blog, David Enna is a long-time journalist based in Charlotte, N.C. A past winner of two Society of American Business Editors and Writers awards, he has written on real estate and home finance, and was a founding editor of The Charlotte Observer's website.
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