This Week’s New 30-Year TIPS Still Isn’t A Winner

Summary

  • 30-year real yields have been climbing, but remain below levels that would make them “interesting.”
  • The 30-year inflation breakeven rate is currently trending at 1.9%, an attractive number but one that reflects the reality of stubbornly low inflation.
  • Conclusion: This is a risky investment.

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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3 Responses to This Week’s New 30-Year TIPS Still Isn’t A Winner

  1. Lynne Olson says:

    I am five years into building a mostly ten year TIPS ladder which I will hold to maturity. Can you suggest a template for keeping track of TIPS purchase price, semi-annual INT, OID etc. to be used in figuring cost basis when the individual TIPS mature? (I do have a five year TIPS maturing which was purchased way above par, so figuring a loss will be necessary this year. That has made me realize the importance of good record keeping for my other TIPS.) My TIPS are in taxable. Thanks!

    • Tipswatch says:

      I personally use an Excel spreadsheet, listing TIPS in the order then will mature. I include a column for my original cost, plus a column for the original par value. I update the inflation indexes every few months, and multiply those by the par value (the original purchase amount) to show the current value. I am not concerned about “secondary market value,” since I am holding to maturity. This works well for me, and I can easily see which TIPS will mature each year and what my original investment was.

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