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What to Do about Vanguard GNMA: Part II

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What should you do about Vanguard GNMA? Let’s change the question. What should you do about your house or an investment property when there’s a change in price? Answer: not much. “Think about your GNMA fund as you would a piece of income property. For a landlord, it’s a waste of time to worry about the price you could get for the property from month to month. The monthly rents are what pay the bills. GNMA is your triple-decker. Why sell it? You need the rent money.”

I wrote that to you back in March of 2013. And guess what GNMA did? Well, it took a nose dive of course. Sorry. Yup, it kept on going down, down, down, down for another four months. Not fun. But if you stuck around, you were able to pick up more shares for less money. Since GNMA hit bottom in September of 2013, shares are up over 9.3%.

Looking back or looking forward, I don’t get too excited about the ups and downs. Why? Because I like them both—the ups and the downs. In a perfect world the market will be on a steady decline—as you squirrel your money away—right up until the day you retire. See ya boss! Then it jumps by a thousand percent on day one of retirement. You’re golden! Why not take advantage of the times when you’re investing/re-investing when prices are down? What you’ll find is that, over time, even the blind squirrel finds a nut.

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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.