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Are Real Return Bonds Still an Attractive Alternative?

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Are Real Return Bonds Still an Attractive Alternative?

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10

National Bank 06Mar00 RRBs remain an attractive alternative. If, on the one hand, the [bond] market does well, so will RRBs, though to a lesser extent. On the other hand, if the market does poorly, RRBs will offset losses. Having said this, the more uncertain the bond market outlook, the more weight should be given to RRBs in portfolios. Asset Allocation with Conventional and Indexed Bonds S.P. Kothari & Jay Shanken 01Mar00 “These observations suggest an important role for indexed bonds in a diversified investment portfolio. The risk-reduction benefits of indexed bonds reflect fundamental economic relations and are likely to persist in the future.” Inflation-Indexed Treasury Bonds: Cash Flows, Taxes and Simulated Returns Journal of Financial Planning Apr99 “The purpose of this paper is to evaluate the risk-and-return features of TIPS relative to conventional fixed-rate bonds. Special attention is given to the tax treatment of TIPS, inflation conditions under which TIPS outperform conve

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