list of riskless assets in the us market?

Answer 1

I agree completely with Vegas. There are no riskless assets in the U S market or in any market for that matter. Many consider t-bills to have the least risk, but they are mistaken. The main problem with t-bills is that the interest they pay is about 3 to 5% less than inflation after taxes. Forget the official government inflation rate. It is a lie. Perhaps even more with the value of the dollar continuing to decline.

Perhaps currently the asset with the least risk but nevertheless a substantial risk would be 640 acres of Illinois or Iowa corn field. However, the changes is weather patterns due to global warming may detrimentally affect the precipitation in those areas not to mention the cost of fuel for ones tractor.

Another possibility is a bought and paid for congressman. They tend to give a substantial ROI provided they do not get voted out of office.

Answer 2

There are many kinds of Risk. The most obvious is Market Risk. If the Market goes down you lose money.

There is Inflation Risk - a safe investment that does not exceed the rate of inflation, then you lose money.

The Safest investments seem to be the ones guaranteed by the full faith of the USA. Even those ar not riskless.

Try the website diehards.org they have several conversations about risk.

I believe that if you use Mutual Funds You deversify and Low Cost , passivlely managed with bonds and International to diversify risk.

It is a reasonable plan. You can accomplish this with one fund such as Vanguards Target retirement funds pick one with the % of bonds you like..

Safe is a State of mind in the market, what really is important is whether you can sleep at night with your current investments.

Good Luck Gerry

Answer 3

When finance people talk about the risk-free security, they would mean a US Treasury Security that pays no coupon and pays off on your horizon date.

For example, if you are looking at a one month investment period -- then the one month T-Bill would be the right risk-free security. If you have a one year period, then the one-month would not be a good choice -- because there is reinvestment risk. You would have to use the one year bill (or zero coupon bond).

Answer 4

zero. If you buy a treasury short term note you take the risk that you are making far less than you could + the likelihood of losing purchasing power after taxes and inflation. Diversification is the only way to reduce (can never eliminate) risk.

Answer 5

BRK-A and BRK-B. Significantly outperformed the S&P 500 in up markets, down markets, good credit environments, bad credit environments.

In regard to the post by vegas_iwish, a wise man Marty Whitman once said that "Diversification is a substitute, and a damn poor substitute at that, for knowledge, price-consciousness, and control."

Best of luck.

Answer 6

No such thing as "riskless."