Yields on Treasury Inflation-Protected Securities surged last week, with the 10-year reaching 2.42% (its highest since October 2023) and the 30-year surpassing 2.97% (its highest since late November 2008). The rally followed U.S. strikes on Iran, which pushed Brent crude futures up more than 14% for the week. According to a Schwab analyst, a 30-year TIPS at 3% combined with 3% inflation delivers a 6% annualized nominal yield. However, long-dated TIPS carry substantial interest rate risk and should represent only a small portion of a diversified portfolio. TIPS are available directly through TreasuryDirect starting at $100 or through ETFs such as VTIP.
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