Summary
- The overall TIPS market has had a huge run-up of almost 16% since the bond market turmoil of mid-March.
- The TIP ETF hit a record high of $126.51 last week, but its one-year performance has been in line with other big bond funds.
- This ETF is not diversified, with only 42 holdings of a single type of U.S. Treasury. It is more volatile than core bond funds.
The iShares TIPS Bond ETF (TIP), which holds the full range of Treasury Inflation-Protected Securities, has had a huge run-up in the last five months, rising almost 16% since it closed at $108.81 on March 18, a day of intense market turmoil. On Thursday, August 6, it closed at a record high of $126.51.
Many readers have been asking me: After this year’s big run-up, is it too late now to begin investing in TIPS?
Yes, in this case it was $10,000. I will add to that longer-term position if I see the opportunity. Of…