Allan Coleman's Sept 11, 2007 GNMA Update

Posted on our Facebook Forum by Allan Coleman

Allan Coleman wrote:

As expected , the navs of our favorite Vanguard GNMA funds ( VFIIX & VFIJX ) DROPPED to $10.24 share price at the close today . The bond market traders may be finally getting the message that Bernanke and the Fed may ONLY cut rates by a quarter point next week and started pricing treasuries accordingly taking some profits now before having to unwind larger positions next week .

Observations :

VFIJX = 4.09% ytd with a 5.25% yield

VMMXX = 3.61% ytd with a 5.06% yield as market money returns also possibily consider next weeks unwinding with a lower Fed funds rateVFIJX = 0.89% ytd with a lower 8.20% yield . Price on this Vanguard High - Yield ( junk ) bond fund has remained unchanged for the last four trading days and really hasn't moved much off $5.94 / $5.95 for the last 13 trading days while GNMAs have moved mostly up a dime .

Personally , I'll do further research tonite on buying this junk bond fund this week , well before the Fed acts next week and possibily making a second buy in this fund on the Fed decision announcement next week .

On GNMAs , looking to get another buy in this fund below $10.20 a share price . A fifth $101k purchase at $10.20 a share price would give this old surfer a average price of $10.00 a share since I made my first buy in June 22nd of 2006 .

P.S. Tom , my specific advice to you on your GNMA purchase is :

IF you think the Fed's going to CUT rates next week , you might consider making your GNMA buy BEFORE the Fed meeting announcement or the day of the announcement and take the closing nav price you'll get that day .

IF you think the Fed is going to HOLD , wait until AFTER the Fed announcement to make your purchase .

National Do Not Call Registry Renewal

DaveD reminded us in our forum "The Art of Making Do" that you need to renew your "Do Not Call" registration every five years. (Request Invitation to our facebook discussion group.)

Dave wrote:

Unless you like chatting with folks a dinner time.
https://www.donotcall.gov/Register/Reg.aspx
I think its every 5 years we
have to do this national and local

More information from https://www.donotcall.gov/default.aspx

WHAT YOU SHOULD KNOW ABOUT THENATIONAL DO NOT CALL REGISTRY

"The National Do Not Call Registry gives you a choice about whether to receive telemarketing calls at home. Most telemarketers should not call your number once it has been on the registry for 31 days. If they do, you can file a complaint at this Website. You can register your home or mobile phone for free. Your registration will be effective for five years. "

If you are called after you have registered, get the name of the person who called and ask for their phone number. One way to do this is to say you have to go to the bathroom, get the baby, or you are talking to someone on another line and will call them back in 5 minutes. Note the time they called.