spin: Actually, it's mainly in VFSTX...
nowadays. Vanguard short-term corporates. Current yield about 3.87%. Also a fairly significant chunk in TIPs. I believe there isn't that much credit risk in the short term investment grade corporates and obviously the short term duration takes away most of the risk of rising rates. It ain't gonna make me rich, but it narrows the spread between my asset yield and my mortgage debt to about 1.5%. Being short term on the asset side and long term on the liability side, I'm hoping to get to a positive arbitrage point within two-three years.
P.S. Years ago (like 20), I instituted a hedging strategy for the benefit of my employer that used puts on the 30 year treasury bond. In those days there wasn't much of a public market for derivatives, so I had to negotiate an instrument with a large money center bank. If you want to see how it went, go back and look at the yield curve in mid-1984.
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