Non-US Investing • Is a TIPS fund OK?

I'm 50 years old. I'm a US citizen living in the UK.

I have roughly 10% of my wealth in VTIP (Vanguard short-term TIPS ETF). I also have about 15% in short-term non-TIPS bond funds, 12% in cash, and 60% stocks.

I know that there's a lot of different opinions about bond funds and TIPS funds. I just read this from Jason Zweig in WSJ:

With TIPS, you do not want to buy a fund; TIPS funds suffered losses of up to 30% in 2022 when interest rates shot up. (If you held individual TIPS, you wouldn’t have suffered a loss that year unless you had to sell.)

I am fortunate to have plenty of wealth, and no expected need to use it for at least a decade. So I'm not sure whether the short-term fluctuations are a problem for me or not. I've always thought of this fund as an easy way to hedge against a big bout of unexpected inflation, without the hassle of a bond ladder.

Is it OK for me to have this fund? I understand ETFs well; I'm kind of scared of new things, like purchasing individual bonds for a bond ladder. Also, does being an expat add any additional complications here?

Statistics: Posted by dcabler — Sat Apr 27, 2024 5:21 am — Replies 1 — Views 111