People get greedy, you know. The S&P 500 has been doing alright for itself these past few years. Double-digit gains. Three years running. It’s almost…unnatural. So it goes.
There are these indicators, these little warnings. The Shiller CAPE ratio. The Buffett indicator. They suggest things might not stay so rosy. Numbers don’t lie, though people sure do try to make them. It’s a funny thing, this whole financial world. A bit of a mess, really.
So, what do you do? You try to protect what you have. Not because you expect the worst, but because, well, the worst has a habit of showing up anyway. Here are three funds. They might help. Maybe.
1. Vanguard Short-Term Treasury ETF
Long-term bonds used to be the safe bet. The go-to when things got shaky. But State Street, those number-crunchers, did a study. Said long-term Treasuries don’t offset losses like they used to. And China’s been selling them off. Denmark, too. Seems everyone’s reassessing what “safe” even means these days. So it goes.
Short-term Treasuries, though. Those are still holding up. Less exciting, certainly. But less likely to leave you completely underwater. The Vanguard Short-Term Treasury ETF (VGSH) owns a lot of them. 92, last I checked. Average duration of 1.9 years. Costs you 0.03% a year to hold. A small price, perhaps, for a little peace of mind.
You won’t get rich with this one. But you probably won’t lose much, either. It yields around 3.6%. Not a fortune, but enough to buy a decent cup of coffee. Or two.
2. Vanguard Total Bond Market ETF
Bonds, generally, are a bit safer than stocks. When stocks go down, bonds often go up. It’s not a perfect relationship, of course. Nothing ever is. But it’s a decent hedge. The Vanguard Total Bond Market ETF (BND) owns a whole lot of bonds. 11,444, if you’re counting. So it goes.
Average duration is 5.7 years. A bit longer than the short-term Treasuries. About 69% are U.S. government bonds. The rest are corporate bonds, rated BBB or higher. Not the riskiest out there. Yields almost 4.2%. A little extra for taking on a little more risk.
Vanguard says this ETF is for people who want income and diversification. Sounds reasonable enough. A little bit of both can’t hurt. Though, of course, it won’t save you from everything. Nothing will.
3. Vanguard U.S. Minimum Volatility ETF
This one’s a bit different. The Vanguard U.S. Minimum Volatility ETF (VFMV) actually holds stocks. Stocks are usually riskier than bonds. But this ETF tries to pick stocks that are less likely to swing wildly. It’s a bit like trying to find a calm spot in a hurricane. So it goes.
It owns 186 stocks, across 10 sectors. Lam Research, Johnson & Johnson, Keysight Technologies, Coca-Cola. Solid companies, mostly. No single stock makes up a huge chunk of the fund. Keeps things a bit more balanced. Costs you 0.13% a year to hold. Still not bad.
It won’t be immune to a big stock market crash. Nothing is. But with a beta of 0.56, it should fall less than the overall market. A little bit of protection. A little bit of hope. Which, let’s face it, is about all we have sometimes.
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2026-02-01 11:53