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AOK with Vanguard GNMA

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You can take comfort in knowing you’re AOK with Vanguard GNMA. Pay no attention to the doomsayers calling for the bursting of the bond bubble. “Vanguard GNMA is one of my two largest holdings, and I would like to see it as one of your top two,” writes Dick Young in the September issue of Intelligence Report. Dick continues:

 

Buy Vanguard GNMA

Ginnie Mae’s balance sheet doesn’t use derivatives to hedge or carry long-term debt. What Ginnie Mae does is guarantee investors the timely payment of principal and interest on MBS backed by federally insured or guaranteed loans—mainly loans insured by the Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA). Ginnie Mae MBS are created when eligible insured or guaranteed mortgage loans are pooled by approved insurers and are securitized. Ginnie Mae MBS investors receive a pro rata share of the resulting cash flows. Ginnie Mae securities are the only MBS to carry the full faith and credit guarantee of the United States government, which means that even in difficult times, an investment in Ginnie Mae MBS is one of the safest an investor can make. In the crash year of 2008, with the NASDAQ down a staggering 40%, Vanguard GNMA was up 7.2%.

Vanguard GNMA is the lead position in my newly introduced Maximizers portfolio and is one of our largest client holdings at Richard C. Young & Co., Ltd. No investor should be without a core position in Vanguard GNMA.

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E.J. Smith

Editor-in-Chief
E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@youngresearch.com.