Larry Berman CFA, CMT, CTA
Vanguard Short Term Bond ETF
BSV-N
COMMENT
Mar 24, 2025
BNDX and BSV correlated inversely with the Fed Fund rate?
Actually, incorrect. If the US economy is doing very well, the Fed will raise, not cut, interest rates. You can't rely on Fed policy to know what the broader bond market will do. BSV is short-term bonds and much more correlated than BNDX which is about the broader bond market.
This product is fine. With Vanguard, you know you're getting quality and lower cost. Have to be aware that bonds have done poorly this year, and the longer the bonds, the more they've been beaten up. Positive toward short-term bonds. He'd look to pick some up after the first week of June, when he understands rates are going up by 0.5%.
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Actually, incorrect. If the US economy is doing very well, the Fed will raise, not cut, interest rates. You can't rely on Fed policy to know what the broader bond market will do. BSV is short-term bonds and much more correlated than BNDX which is about the broader bond market.