Did Every Bond Fund Really Lose 40%? The Facts on TLT and BND

AI-generated source summary

The speaker discusses that not all bond funds experienced a 40% hit, contrasting TLT and BND. TLT, the iShares 20+ Year Treasury Bond ETF, traded around 79 in late September 2020, with a peak in 2020 around 179. It experienced a drawdown of about 18.5% by the summer, bringing it back to a total return basis. In contrast, Vanguard's BND, a broad bond fund ETF, is presented as a different kind of animal, with a worse drawdown of approximately 18.5% by the summer. The speaker highlights that while tech stocks fell 5.5% in a week, TLT went up, indicating that bonds did their job for the first time in a long time, implying the defensive nature of bonds still works, though it costs more money to keep them on the field. The analysis suggests a bullish outlook for both TLT and BND, with TLT's target inferred to be around 100.79, and BND's target around 80, with failure bounds set at 78 and 62 respectively.

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