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4 Vanguard Bond Funds to Buy (And 3 to Avoid) for Higher Interest Rates

Higher rates are coming and now is a good time to distinguish between the best and worst bond funds

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Vanguard Bond Funds to Buy for Higher Rates: Vanguard Intermediate-Term Bond Index (VBIIX)

Vanguard Bond Funds to Buy for Higher Rates: Vanguard Intermediate-Term Bond Index (VBIIX)
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Expenses: 0.15%
Minimum Initial Investment: $3,000

Investors that prefer passive management over active management are smart to look at funds like Vanguard Intermediate-Term Bond Index (MUTF:VBIIX).

Long-term bond funds are more interest rate-sensitive than intermediate-term bond funds but short-term bond funds have lower yields. Because of this, the sweet spot for many investors with holding periods of more than a few years is intermediate-term bond funds. And if you want passive management, VBIIX is arguably the best bond fund for you.

VBIIX has a good balance of about 50% government securities and 50% corporate bonds.

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