Bond ETF graph question

Zoot Allures

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I have never had a bond etf but it is time to consider putting my cash into it until Trump is locked up

Bonds pay interest or yeilds

When I search a bond etf graph how do I know if the graph is assuming all yeilds were reinvested ?

A bond graph without the yeilds reinvested is as misleading as a dividend etf graph without the dividends assumed reinvested
 
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Ponderling

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Most bond funds pay out. As in effective yield.
You have the choice to reinvest the payments.
I take the proceeds from my bond holdings, and equity dividend payments as well and buy more bonds or equities as my rebalancing situation dictates.

There may be corporate class funds that aim to make everything a capital gain.
I have not looked for these.

The amount of bonds I aim to hold will eaily fit inside my RRSP. LIRA and TFSA holdings for a t least the next 2 decades.
 

Zoot Allures

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Jan 23, 2017
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Most bond funds pay out. As in effective yield.
You have the choice to reinvest the payments.
I take the proceeds from my bond holdings, and equity dividend payments as well and buy more bonds or equities as my rebalancing situation dictates.

There may be corporate class funds that aim to make everything a capital gain.
I have not looked for these.

The amount of bonds I aim to hold will eaily fit inside my RRSP. LIRA and TFSA holdings for a t least the next 2 decades.
My question is are dividends and yields payouts included in a graph?
 
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Ponderling

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IMO not as much importance in a graph of a bond fund.

You want to know current yield and present average duration of the holdings.

Graphs of equity positions may or may not show the effect of reinvested divvy's. That info is usually in the fine print of the notes on the graph.

Graphs by definition are performance looking in the past.

And do not necessarily factor how things go forward.

Particularly if legislative or tax scenarios change.
 

Zoot Allures

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IMO not as much importance in a graph of a bond fund.

You want to know current yield and present average duration of the holdings.

Graphs of equity positions may or may not show the effect of reinvested divvy's. That info is usually in the fine print of the notes on the graph.

Graphs by definition are performance looking in the past.

And do not necessarily factor how things go forward.

Particularly if legislative or tax scenarios change.

I agree about bonds graph but graph is of real importance with equity ETF as they have dividend companies


This what I think I know about bond ETF

1 bond prices will fall and rise with interest rates as your bond becomes more or less valuable as interest rates go up or down because your bond interest does not change but yield does as yield is interest divided by bond price

2 bond price also changes with bond security ratings

3 So, bond ETF value changes when the value of their bonds fluctuate but ETF bonds
expire daily and so they buy more bonds daily so they are continually changing bonds to match
current interest

4 If you do not want bond value flucuation then buy your own as interest payouts will not change
and you get all your original bond price on due date but you lose liquidity


5 Bond prices generally lag equity in both up and down markets
IE they rise less or fall less , but that depends on above points so
they can actually rise in a bear or fall in a bull

It is still important to understand a bond graph so you can compare accurately
 
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Ponderling

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The other twist is that some types of bonds can be 'called'.

ie the issuer can pay them off early if the old one is paying more interest and can be replaced by the issuer with new money financed at a cheaper current cost.

The other bondish holding are preferred shares. They are bond like and equityish at the same time.
We keep about 5% of our portfolio in them.
They currently 'yield' about 4.8% for us. We use HPR, a managed ETF. It is nice to have about 14K of income, paid monthly.


It is kind of a nice no brainer, as they are in non reg, and about 90% of what they pay in a year comes as dividend income, so is lightly taxed.
The share price moves a bit, not quickly.

But you need to keep an eye on conditions. In a rapid jacking of central bank rates the price of preferred can fall, just like bonds.
 

Mandala

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Jan 2, 2025
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Dividends are assumed reinvested with indexes like the S&P IE sll the indexes
reinvest dividends or DRIP them to come up with daily average

If you want a graph for a dividend paying company you should have a choice
on the graph page whether to DRIP
 
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Zoot Allures

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Jan 23, 2017
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The other twist is that some types of bonds can be 'called'.

ie the issuer can pay them off early if the old one is paying more interest and can be replaced by the issuer with new money financed at a cheaper current cost.

The other bondish holding are preferred shares. They are bond like and equityish at the same time.
We keep about 5% of our portfolio in them.
They currently 'yield' about 4.8% for us. We use HPR, a managed ETF. It is nice to have about 14K of income, paid monthly.


It is kind of a nice no brainer, as they are in non reg, and about 90% of what they pay in a year comes as dividend income, so is lightly taxed.
The share price moves a bit, not quickly.

But you need to keep an eye on conditions. In a rapid jacking of central bank rates the price of preferred can fall, just like bonds.

Preferred shares are equity in a company that gets bigger dividend payouts than common stock
and are like bonds as the dividend payout does not flucuate nor the price like in common shares and they get paid before common shares in case of liquidation

The reason not to buy preferred is they do not rise in value like common shares

One reason is they are callable at a set price so investors do not want to pay more than the callable price, in the meantime you get higher dividends but not all are callable as there are several forms of preferred but in the case of HPR ETF owned by Global X they make all the decisions for which you pay a higher MER for active management



Types of preferred shares




 
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Zoot Allures

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Dividends are assumed reinvested with indexes like the S&P IE sll the indexes
reinvest dividends or DRIP them to come up with daily average
I think you are wrong

Charts that include dividends are called growth charts ,or dividend adjusted charts,
they do not list stock price but amount of money you would now have
if you started with 10 grand for the time period you choose. Chart also give percentage
gained. Look for ADJ button at bottom of chart

If a chart is giving stock price it does not include dividends as you believe
 
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Big Rig

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May 6, 2009
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Charts that include dividends are called growth charts ,or dividend adjusted charts,
they do not list stock price but amount of money you would now have
if you started with 10 grand for the time period you choose. Chart also give percentage
gained. Look for ADJ button at bottom of chart

If a chart is giving stock price it does not include dividends
I phoned morningstar.ca (Canada) and asked about growth charts and they do not have them
even if I buy premium service WTF??????

Unless I am missing something, you are right about growth charts being more important
than stock chart.

I will not be buying Mormingstar premium
 
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