With the part of my portfolio that I still self manage, I sold my 2 bond funds a few months ago, RSIVX and PONDX. I put most of the money into RSAFX. I figured with rising rates in the future, having a bond fund that treads water at best didn't seem productive. An alternitive fund like RSAFX isn't for everyone but David's write up on this fund sold me.
Your post made me look at the comparative results of my decision, and so far so good.

A couple of American Funds bond funds up fractionally. Also WAFMX! Glory be!!
RSIVX, RPHYX & TAFTX all flat.

rphyx = down .101
rsivx = down .3
tginx = down .876
mwcrx = down .167
Have a great weekend, Derf

I was interested to see Ed reference Joel Tillinghast to the effect that Japanese and Korean small caps are about the only (absolute) value areas left in this market. Ed seemed to agree, at least on the Japanese part (Ben Graham heaven he called it). Looking around in mutual funds, I note that HINVX has almost half of its holdings in those two countries. That might be an aggressive play for a value investor.
To say that I'm wary of this market is an understatement, and if I was to give advice it might be to go with some of those defensive funds noted by David (PVFIX for a great example). Take your normal stock allocation to those funds and let them decide when to allocate the cash reserves. As for bonds, I still see RSIVX as doing what it said it would do. Little movement in the NAV, nice yield.

I hold a fair amount of "near cash" in RPHYX and RSIVX. Each one has returned a tad over two percent in the last year, the former is closed, but the latter is open. There has been a fair amount of discussion on the board about using this type of fund in lieu of MM or CDs. They throw off frequent distributions, so there's a tax consideration.

Taxable account. What I use it for is basically the expectation I mentioned. I keep a range of credit-risky FI in what I think of as a separate sleeve in the portfolio, and ASHDX is a lower duration/higher quality (and therefore presumably less risky) piece of that sleeve. In the past I've used other funds (e.g., OSTIX, RSIVX) to fill the short & junky role.

I was just checking their respective holdings on *M and you are right: OSTIX holds a bit more lower-rated junk bonds than ASDHX. At last check, OSTIX had about 37% of its portfolio rated below B, whereas ASDHX had about 8% rated below B.

Taxable account. What I use it for is basically the expectation I mentioned. I keep a range of credit-risky FI in what I think of as a separate sleeve in the portfolio, and ASHDX is a lower duration/higher quality (and therefore presumably less risky) piece of that sleeve. In the past I've used other funds (e.g., OSTIX, RSIVX) to fill the short & junky role.

FPNIX is IMHO a unique fund, one managed for preservation (using a wide variety of strategies and derivatives defensively), as contrasted with a fairly vanilla (albeit well managed) short term bond fund.
Different paths to the same end. As you note, performance is very similar after expenses. Which suggests that the modest incremental cost of the more wide ranging fund has been paying for itself, even in a pretty constant low interest environment. When the markets shift sooner or later, I expect its defensive strategies to show their mettle.
If one just looks at average figures (which, especially in the case of FPNIX I feel do not tell the whole story), one is getting double the SEC yield and duration that's only 3/4 as long (1/2 year shorter) in exchange for diving into some junk. (Though nearly 70% of the fund's bonds are AAA rated - more than BSBIX's AAA, AA, and A combined.)
I'm a fan of Baird funds, so I'm not knocking BSBIX. Rather, I'm addressing what is different about FPNIX.

I'm another fan of the Baird Funds, but I'd say the main difference between BSBIX and FPNIX is that the disastrous year of 2008 saw BSBIX lose 1.79% while FPNIX managed a gain of 4.31%. That would probably be something of a worst case scenario for BSBIX in a comparison with FPNIX. Otherwise, BSBIX seems to pretty consistently outperform FPNIX by a small margin.
I should think if the original poster is willing to wait 3-5 years that pretty much any solid short term bond fund will provide a small gain (maybe 2% or so). I wouldn't argue against either BSBIX or FPNIX, or even ZEOIX or RSIVX (which are quite different but still pretty safe over 3-5 years, I think).

I know this topic has been tossed around numerous times on this board, but I'm always looking for suggestions on what to do with my cash. I'm 50 years old with more than $100,000 sitting in banks and credit unions earning about 0.50 % in interest. I know it will erode in value over time due to inflation, so I would like to beat that at the very least without taking a big risk with principal. I already have nearly $1M in a conservative portfolio (35% Bonds) (40% equities) (25% cash) so I'm looking to do something with a portion of the cash. Part of it should stay in an emergency fund, but I have about $100,000 that doesn't need to be used for at least 3-5 years. I call it "near cash." I've been looking at a few suggestions on the board, such LALDX, OSTIX and RSIVX. It appears that interest rates will be higher over the next few years so I do have to take that into consideration with any bond funds. Any other suggestions? Thanks in advance.

David shared a copy of his quarterly shareholder letter with me earlier this week. It's posted on the RiverPark site now and it's worth reading.
I came away from it with two strong impressions:
there may be emerging structural problems in the investment-grade fixed-income market. At base, the unintended consequences of well-intended reforms may be draining liquidity from the market (the market makers have dramatically less cash and less skin in the game than they once did) and making it hard to market large fixed-income sales. An immediate manifestation is the problem in getting large bond issuances sold, a potential problem might be the emergence of a roach motel issue if things get rocky. That is, it might be easy to get in but impossible to get out of some safe issues.
Mr. Sherman is very cognizant of the need to have portfolios that could ride out a storm without the need to liquidate holdings; better than half of RPHYX will roll off to cash with 60 days and a quarter of RSIVX is invested in the same securities as RPHYX is. His argument is that given the challenges facing large bond issues, you really want a fund that can benefit from small bond issues. That means a small fund with commitments to looking beyond the investment-grade universe and to closing before size becomes a hindrance.
Some of his concerns are echoed on a news site tailored for portfolio managers, ninetwentynine.com. An article entitled "Have managers lost sight of liquidity risk?" argues:

A liquidity drought in the bond space is a real concern if the Fed starts raising rates, but as the Fed pushes off the expected date of its first hike, some managers may be losing sight of that danger. That’s according to Fed officials, who argue that if a rate hike catches too many managers off their feet, the least they can expect is a taper tantrum similar to 2013, reports Reuters. The worst-case-scenario is a full-blown liquidity crisis.

The article goes on to express concern that holding elevated cash levels is a poor response since panicked withdrawals could quickly exhaust even an elevated cash stash (see 'Total Return Fund, PIMCO" for details), leaving managers "out of both cash and choices." The better solution, they argue, is building "organic liquidity" into the portfolio. Which, I believe, is what Mr. Sherman has done.
Hope your weekend has started well. It's cold and rainy here, which is keeping me out of the garden and close to the keyboard.
David

Great call; missed it but caught the mp3 yesterday. I thought AF's explanation of how security picking and macro interact in the Seafarer process was about the most detailed and illuminating I've heard from any manager.

Let me second AndyJ on this. I think Foster has it exactly right: It would be wonderful to get the future Macro environment right, but the unfortunate fact is that nobody can. Better to concentrate on something you might be able to judge with some accuracy, i.e., a company's fundamentals over the next couple of years (maybe 5 years tops in my view).
And a belated thanks to David for setting up these calls. In two cases (Seafarer and RSIVX) they've convinced me to invest in funds I likely would not have otherwise.

Yes, I was thinking the same thing. I am also curious if the steady uptrend is due mostly to fund inflows, rather than performance. I remember the same thing happening with RSIVX/RSIIX.

A quote from the article by the manager of RSIVX and RPHYX:
“It’s an awful time to be an investment-grade bondholder,” David Sherman, founder of New York-based Cohanzick Management LLC, which manages $1.6 billion, said in a telephone interview.

Glad I read this synopsis... I think I'll be taking advantage of the Institutional Shares - No Minimum Investment being offered to direct RiverPark investors. It seems opportune to put a small deposit in just to have the I shares. And I emphasis 'small'. I'd like to see current holdings and a little history to see if it matches my temperament before venturing further.
@Derf: Yes, the NAV on RPHYX/RPHIX and RSIVX/RSIIX have dropped, but if HY is yielding 3% and SI is doing 5-7%, I feel I can take a hit on the asset value and offset it with the interest yield while I keep my fingers crossed. My 'Total Return' is still positive and it's better than Money Market or banks.

ER for RSIVX is 1.24%, and 1.18% for RPHYX. Seems they trade a lot, if I understand the strategy.

Well, with RPHYX I'm up some $5600 over my basis. I can't give actual percentage gains because I've added to that account a number of different times, and while I do know the methodology to approximate the percentage gain it's just more trouble than I want to go to, so I just keep the YTD data.
RSIVX is up 1.3% YTD, not too bad, but it's also a different animal than RPHYX.
One reason that I like those two is that they're NTF at Schwab, so easy to get into and out of cheaply.

I have parked cash in RPHYX and RSIVX for about the last 15 months. My basis is actually more than the market values of these funds given the reinvested dividends and paltry increases in NAV. The money seems safe, but I almost feel as though I'm paying someone a parking fee. Like Whakamole, I would never have known about these funds without MFO.

@VintageFreak: with the NAV of both RPYHX & RSIVX dropping, have you thought about lowering holdings of both?
Derf

will evaluate as an IRA a candidate to complement. I already hold RPYHX and RSIVX in there.

There are lots of options. Are you looking for munis or just taxable. Some cef's may fit the bill also. Check out http://www.cefconnect.com
RVNU
NMZ
RSIVX
FLTMX